Written Evidence from the Association of Scotland’s Self-Caterers (ASSC)
Introduction
The ASSC welcomes the opportunity to provide evidence to the Scottish Parliament’s Local Government, Housing and Planning Committee to help inform their scrutiny of the Scottish Government’s short-term let licensing regulations. This elaborates on the oral evidence we provided to the Committee on 7th December 2021.
Self-catering is hugely important to Scottish tourism in terms of jobs, revenue, and the world-class experiences we’re able to offer our guests. To be such an essential part of Scotland’s tourism mix is even more remarkable for our sector, which generates £867m per annum when we consider that most self-caterers operate small or micro businesses. Scotland’s professional self-caterers are diligent, conscientious, and considerate business people who are too often unfairly maligned. We do not, for example, ‘hollow out communities’, as some have claimed, but rather are part of local communities across Scotland and have been for many, many years. In fact:
The ASSC is not averse to regulation; but we do challenge policies which will damage the livelihoods of our members and Scotland’s vital tourism industry. Overall, we want to ensure a balanced and proportionate approach for business, tourism and local communities and get a regulatory framework in place that works for all. It must also be remembered that professional operators are already regulated so the mandatory conditions are essentially duplication and therefore unnecessary.
Any regulations pursued need to be underpinned by robust empirical data. Unfortunately, there has been a tendency to focus on so-called ‘scraped data’ from Airbnb which can lead to misleading conclusions about the nature of the short-term letting landscape in Scotland.[2] Further detail is available on this in Annex 1.
Overall, this one-size fits all, onerous and disproportionate licensing system will damage Scottish tourism and discriminates against small and micro businesses like self-catering and B&Bs, especially in rural and remote areas, and comes at the worst possible time for industry when Covid-19 remains an ongoing issue and when the sector is still in recovery mode.
Recent Developments on Short-Term Let Regulation
The Cabinet Secretary for Housing Shona Robison outlined changes to the Scottish Government’s proposed licensing regulations on 7th October 2021. We endorsed the decision to remove overprovision from the licensing regime, which was a duplication with planning policy. This recognises that the government’s objective with the regulations was about ensuring health and safety across all short-term lets, not addressing housing issues.
This recognition is vital for setting the parameters of this debate. We are concerned that the short-term let licensing regulations – which are intended to focus on health and safety – are still being discussed within the context of housing, a fact reflected in the evidence sessions of 7th and 14th December 2021. However, licensing regulation deals with the safety of an activity, not housing. Short-term let Planning Control Area legislation was passed by the Scottish Government in February 2021 and is solely related to the use of a property. They are two entirely separate pieces of legislation dealing with totally different issues. Neither piece of legislation will in any way ameliorate the issue of second homes. Nevertheless, there is no empirical data which demonstrates a link between short-term lets and the housing market; moreover, we know that there are five times as many empty homes in Scotland than self-catering units. At no point will this legislation tackle homelessness or depopulation as alleged by some MSPs.[1]
Despite the positive change on overprovision, a number of important industry concerns remain following the changes from 7th October. Most notably, we are concerned about the disproportionate financial impact of licensing fees on small and micro tourism accommodation businesses who are still in survival mode due to the crippling effects of the pandemic. Taken together, the licensing scheme proposals at national level and the planning control areas at a local council level[2] is creating a perfect storm of uncertainty for small business. In addition, outwith the concerns affecting industry, we believe that the resourcing impact on local authorities has not been fully considered by the Scottish Government.
The 2021 Business Regulatory Impact Assessment states that the Scottish Government is confident that the tourism sector will have recovered adequately by March 2023 but, as the new omicron variant is demonstrating, the impact of pandemic is ongoing. Policymakers should therefore take cognisance of these circumstances and support small businesses through this and minimise burden.
The Licensing Order was withdrawn in February 2021 as it was widely recognised as unfit for purpose; however, in December 2021, the revised Order remains unfit for purpose.
Key Outstanding Issues for ASSC Members
In addition to continuing our call for an exemption for registered businesses, the ASSC seeks further compromise on the following:
We stand ready to work with the Scottish Government, MSPs, the Committee, and relevant stakeholders to get the details of the legislation and guidance absolutely right. At this crucial stage of Covid recovery, we must work collaboratively to protect Scotland’s £867m self-catering industry and not burden small businesses who do so much to promote and enhance the country’s unique tourism offering and boost local economies.
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Outstanding Concerns: Contents
Our outstanding concerns are set out in more detail under the following headings:
Level Playing Field / Discrimination against small businesses
The Scottish Government has concurred with industry that self-catering businesses and B&Bs have legal obligations to comply with existing health and safety legislation, with the then Minister Kevin Stewart responding stating that “the principal component of our licensing scheme is a set of mandatory standards which apply to all short-term lets, and will help to protect the safety of guests and neighbours across Scotland. Many hosts, including B&B operators, will already be following these standards as a matter of compliance with existing law or best practice”.[1] Now that overprovision has been removed from the licensing scheme, it is clearer that the rationale behind its introduction is indeed basic health and safety.
Contrary to assertions made, small accommodation businesses are already regulated. For example, the Scottish Government signposts to existing compliance[2] and information regarding non-domestic rates[3], and local authorities such as Argyll & Bute Council also signpost to other legal compliance and best practice[4]. Compliance levels are evidenced in a recent survey that we ran across the small accommodation sector[5]. With that in mind, why does the Scottish Government’s 2021 Business.
Regulatory Impact Assessment[1] continue to state that “At present, short-term lets are unregulated”? This is clearly not the case.
In a letter from the Cabinet Secretary for Social Justice, Housing and Local Government to this Committee on 7th October, Ms Robison outlined changes to the licensing scheme: “We are reviewing the fire safety and electrical safety requirements to ensure that they do not go further than existing law. We will review the guidance on how to evidence compliance with the stakeholder working group“[2]. This is affirmation that there are already adequate safety requirements to cover legitimate businesses and that the Licensing Order mandatory conditions are essentially duplication and therefore unnecessary.
In September 2020, the ASSC ran an online survey to assess levels of professionalism within the tourism accommodation sector and compliance with existing regulations[3].
If the rationale behind introducing licensing is compliance with basic health and safety, why are hotels, serviced accommodation, etc exempt? This exempt accommodation is not licenced on the basis on health and safety but on the sale of alcohol. Subsequently, larger businesses are facing less regulatory obligations, resulting in discrimination against small businesses.
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As background, the Licensing (Scotland) Act 2005 [1] regulates the sale of alcohol in Scotland and is built around the 5 Licensing Objectives, which all licensed premises are expected to aspire to: Preventing Crime and Disorder; Securing Public Safety; Preventing Public Nuisance; Protecting and Improving Public Health; and Protecting Children and Young Persons from Harm. Any licence issued under the 2005 Act relates to licensing of alcohol[2]. No basic health and safety mandatory conditions apply.
Another instance where proportionality would be lacking vis-à-vis hotels and self-catering under any licensing regime can be seen with licensing fees. The Licensing (Fees) (Scotland) Regulations 2007[3] sets the fees in relation to applications for a premises licence. Fees are based on the rateable value of the premises to be licensed. In addition, there is an annual fee due each October.
Examples:
Many hotel chains are now diversifying in to self-catering[7] due to market demand but these properties may be exempt from a licence. The guidance for hosts and operators states, “[a] self-catering property in the grounds of a licensed hotel would also be excluded [from licensing].”[8] We require more clarification from the Scottish Government on this issue as there appears to be an iniquity, one which puts small independent businesses at a clear disadvantage and livelihoods at risk.
Key Questions:
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We note that UKHospitality Scotland said in response to the announcement of revisions from October 2021: “Today’s announcement from the Scottish Government on changes to the proposed licensing scheme for short term lets takes us a step closer to the introduction of parity for all tourism accommodation providers in Scotland. UKHospitality Scotland has consistently called for the introduction of licensing for short-term lets to achieve a level playing field. This is to ensure our members do not continue to be put at a financial and competitive disadvantaged by the expanding rental market."[9]
However, it is small tourist accommodation providers like self-catering who will be disadvantaged, not big hotel chains. Therefore, it is clear that there are two options available here:
Onerous / Burdensome vs Proportionate / Fair
In September 2021, the ASSC ran a survey to assess the views of self-caterers on the Scottish Government’s proposals. From 668 responses in 72 hours:
The Scottish Government’s proposals, as drafted, remain hugely onerous, burdensome and they are not proportionate for small businesses. That is what small tourism accommodation businesses are saying the length and breadth of Scotland. This has not been mitigated by the revisions to the scheme.
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Compliance obligations with current legislation for the self-catering sector are already costly – please see Annex 2 and 3 for details on the existing levels of regulation. The suggestion that a further layer of authorisation including application (every three years), inspection and monitoring costs incurred by a licensing scheme – possibly requiring the advice of a licensing lawyer – with the added complication of possible neighbour objection (often on vexatious grounds), will not be additionally onerous is incorrect.
Any fee that is added to the existing cost of doing business will be untenable for small businesses, especially in light of the global pandemic, with huge increases in energy prices, services and consumables. For legitimate businesses that already pay significant costs to comply with existing legislation, adding even a ‘small’ fee would be a significant financial burden.
All of this will be before we consider the impact of the Planning Control Area Regulations which are being taken forward by City of Edinburgh Council (while also under active consideration by other local authorities like Highland and Fife Council).
Key Questions
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Uncertainty
Fees
Key Questions (a) Have the Scottish Government taken cognisance of the concerns expressed by SOLAR and several local authorities on licensing fees? (b) What is the rationale behind scaled fees if it is on the grounds of checking basic health and safety? (d) Can the Scottish Government guarantee that local authorities will not use this as a revenue generation channel, rather than on a cost recovery basis?
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Additional Conditions / Overprovision
On 7th October 2021, the Cabinet Secretary for Housing wrote to the Scottish Government’s Local Government, Housing and Planning Committee[1] setting out changes to their licensing legislation and guidance. The changes included removing overprovision powers. She added: “Our licensing scheme proposals deliver national consistency on safety standards, and autonomy for local authorities to add further conditions in response to local needs and concerns”.[2]
With these concerns in mind, the ASSC sought Opinion of Counsel from Scott Blair, Advocate, Terra Firma Chambers. The issue is whether an overprovision test can be derived from the 1982 Act.
In short, it can[4].
The following points relate to the issue of over provision being available as a ground of refusal in terms of paragraph 5(d)(3) of schedule 1 of the 1982 Act, and the legal opinion can be summarised[1] below:
Investment: Mortgage / Insurance Provision Implications
Neighbour Objection
There are numerous unanswered questions on this aspect of the proposals. On what grounds may a neighbour object and on what grounds would that / those objections be upheld/overruled? How can fairness, clarity and consistency be ensured across 32 local authorities in terms of licences being granted? What weight should be attached, if any, to an objection from someone who is a neighbour or near neighbour? Is it possible that such an objection could lead to the licence being refused, or not renewed? If so, how would fairness apply, and would that not lead to many cases where legitimate businesses operating for years without incident will suddenly become the focus of opposition from any neighbour who objects?
In terms of neighbourhood objections, evidence rather than anecdote is required when the risk to livelihoods is so great.We believe that neighbourhood objections can be dealt with using existing regulations that are properly enforced.
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Licence duration and renewal policy
The Booking Problem
In addition to issues raised previously[2], including the commercial reality that guests will simply not book if their bookings are conditional, and subject to a term between owner and guest that says the owner can cancel the booking if they cannot either obtain or renew a licence, and the short length of licenced period of up to three years resulting in huge uncertainty,consideration should be given to properties that are let out through web platforms and agencies.
Although in each case the legal contract is with the owner, not the agency or platform, agencies require owners to use the agencies standard contract conditions, and in the case of platforms, the default is to use their standard terms and conditions, that may not support the licensing conditions. Owners will have to change their terms and conditions to make bookings conditional on (a) licences being granted) and (b) licences remaining in force. How will small businesses overcome this level of uncertainty?
Impact on Local Authorities
The ASSC maintains that the extra cost burden to local government who will be responsible for administering the scheme is unreasonable. This includes: human resources, digital infrastructure, committee approval, inspection, enforcement, appeals. This comes at a time of immense strain to local authority budgets, who are under extreme financial and capacity pressures as a result of austerity compounded by the Covid-19 pandemic, with an estimated £350m cut to council budgets outlined in the recent Scottish Government Budget.
While the Committee sadly only heard from one local authority on 14th December 2021 who had been supportive of the regulations, several local councils have expressed concerns about the impact of licensing in the most recent public consultation, as well as in recent public statements. The comments of City of Edinburgh Council at the aforesaid session cannot therefore be taken as representative of the view of all councils.
Here’s what other councils had to say during the 2021 public consultation on the issues of resourcing, fees and start-up costs:
Aberdeen City Council[3]
Resourcing/Fees/Start Up Costs
“We believe that we will be deluged with neighbour objections when the applications start arriving which will result in a much bigger Licensing Committee agenda with all the associated work and costs involved to take an application before Committee. Accordingly, we believe that if the BRIA remains unchanged, it will present difficulties/resentment when the Council opens its licensing scheme for applications and applicants must inevitably pay larger fees than shown in the table of indicative fees. Resolution – We believe that Section F should be completely revised to present a realistic picture of the challenges Councils are likely to face."
“Issue – Given that Short Term Lets licensing is a wholly new activity, all Councils must design and implement policies & procedures, introduce IT systems, recruit additional staff, etc, prior to their ‘go-live’ dates. The costs involved will be considerable with no income until applications start arriving and there is no indication that the Scottish Government will make Grants available to Councils to cover the start-up costs. Resolution – We believe that the Scottish Government should provide Councils with start-up finance, thereafter the licensing activity should be self-financing.”
Fees
“…the indicative fees are unhelpful as they provide an unfair baseline upon which final fees may be compared against. No reference is made to include apportionment of start-up costs for a very complex licensing regime as these will require to be recovered in the initial licensing period.”
Resourcing/Start Up Costs
“…The start-up costs for local authorities in establishing all the components of the licensing regime including additional resource, costs associated with implementing new or developing existing ICT systems and general licensing and planning processes/policies are considerable. It will be difficult to recover these from licensing fees where preparatory works and applications received are may be made over 2 financial years. Consideration should be given to financing local authorities to offset start-up costs, in the way as the Scottish Government provided for the private property owner registration scheme.”
Resourcing/Fees
“As a smaller mainland local authority with very low levels of short-term lets we are still concerned whether the volume of resources that will be required to set up and operate a full licensing scheme is proportionate…we are still concerned that the differences in size and geography, and therefore operating costs, are likely to result in a disparity in the fee levels being set across the country and how this may impact STL levels.”
Fees/Resourcing
“It is not helpful for the paper to set out average indicative fees for licences, even allowing for 2 different scenarios. The fees set out are incredibly low, and could be even lower once all the possible discounts are factored in. The total fees for the scheme are supposed to meet the costs of the scheme and it is clear from the BRIA that the fees can include the costs of establishing as well as running the scheme.
The costs of setting up new teams and new processes, possibly buying new IT packages, will be considerable and will have to be spent ahead of any fee income coming in. LA’s won’t know the level of applications expected so it will be difficult to set fees at a level that will meet the costs.
This section of the BRIA should be more realistic and not give a false hope to applicants of low fees, as the scheme can be compared to the HMO licensing scheme, then fees are likely to be more realistic if that table at Appendix B on page 52 is used as indictive fees. This would range from £167 (renewal fee in Midlothian) through to £1906 (initial fee in Glasgow)
It is also of note that the vast majority of LAs recognise that there is no cost saving to the Council in a party renewing their application, with only 13 LAs listed charging a reduced fee for renewal applications. When LAs make a more realistic costing of their fees which will be significantly higher than the average indicative fees, it will be the LAs who receive complaints and will be inundated with queries and complaints regarding the discrepancy between the figures quoted. It appears that many costs have not been factored into the calculation including enforcement work outlined in paragraph 152.”
Resourcing
“The Council wish to highlight the significant resource implications the Licensing Order will have for the Highland Council:
• Impact on officer time and resources – With approximately 10,000 premises that this will affect in the Highlands, officers will not only be required to implement policies and guidance but also carry out site visits and monitor compliance and enforcement.
• Impact on committee time and resources – there may be an increase in the potential applications before the committee as a result of objections made or lack of information provided by the applicant in respect of their application.”
Fees
“There is a wide discrepancy in terms of potential costs involved in the operation of the proposed Licensing Scheme. The Scottish Government has quoted indicative application fee costs of around £223-£377 while other predictions are as high as £1200-£1500. These discrepancies threaten the fragile recovery of Scottish tourism and demand further work to be undertaken on the actual position.”
Resourcing
“…we note the proposed requirement that local authorities must be satisfied that the Mandatory Conditions will be able to be met by the licence holder prior to granting a licence. We are not persuaded that this requirement is necessary and note that this is not a specific requirement in other similar licensing regimes such as HMO licensing (only that a property is suitable as an HMO). Currently, our HMO licensing process in Renfrewshire involves inspection of the properties to be licensed, but thereafter, as with all other local authority licensing regimes, compliance with mandatory and other licensing conditions is a matter for monitoring and enforcement.
We are very concerned that, particularly when taken together with the 9 month determination period referred to above which will apply after the initial transition period, this additional requirement regarding Mandatory Conditions will require considerable resources to be allocated to short term lets licensing. We have experienced considerable difficulties in relation to landlord registration applications since the introduction of the Private Landlord Registration (Information) (Scotland) Regulations 2019, which relate to broadly similar safety issues as a number of the Mandatory Conditions. Due to the extent of these difficulties, a report is being taken to our Regulatory Functions Board (which is in effect our Council’s licensing committee) very shortly. We anticipate that, based on the proposed checks involved, fees for short term lets may require to be comparable to HMO licence fees to ensure that the cost of operating the short term lets licensing regime can be recovered, as with other licensing regimes under the 1982 Act.”
Resourcing
“No comment other than to state that it seems an unnecessary [sic] burden for both the LA and business owner in some LA areas where there is no problem in the first place and a lack of resources to set up and manage such a licensing scheme. This authority have had one complaint about a secondary letting property and one about a B&B in the last 20 years.”
“In particular, we are wrestling with the issue of how the costs of establishing the licensing scheme can be met while we continue to operate in this challenging financial environment. As you have also highlighted, the fee levels for applicants need to reflect the cost of administering the scheme, but, until we have more information regarding this matter and an idea of the number of applications we might expect, we are unable to give any robust estimate of likely fee levels. This is administratively difficult for the Council but potentially much more problematic for owners of short term let properties, who need to make decisions about the future operation and commercial viability of their properties. Whilst we acknowledge that some areas have suffered difficulties as a result of unregulated short term lets, we are particularly anxious to avoid compromising the valued and valuable tourism sector in East Lothian through implementation of a ‘heavy handed’ and, thus, expensive, licensing scheme to no real benefit.”
Key Questions
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Legal Perspective on Local Authority Impact
The policy intention is that the fee levels should cover adequately the staff and administrative costs. However, that ignores the considerable cost of establishing the scheme, as the Law Society point out: “There are often significant infrastructure costs in introducing new schemes, for example new IT systems, which cannot always be fully recovered…We question whether it is proportionate for applicants to be fully liable for costs of establishing a system, including preparing staff to run the scheme. We suggest that it is appropriate to consider this question in the context of balancing the extent of the mischief which the scheme aims to regulate with the potential gain to the wider public of regulation. In addition, there are likely to be practical challenges with this approach. How may each local authority calculate expected numbers of applications be quantified to be able to work out what the costs should be per application? What is the approach to be by local authorities to differing circumstances, for example, those undertaking home sharing versus those undertaking secondary letting?[1]
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Dismissal of Industry
Antisocial Behaviour
Councils already have powers at their disposal to tackle anti-social behaviour associated with holiday letting through the Antisocial Behaviour Notices (Houses Used for Holiday Purposes) (Scotland) Order 2011). However, they need to enforce it, a point echoed by the then Minister for Local Government, Kevin Stewart in parliament on 8th November 2017. He said that councils had “quite comprehensive powers to deal with antisocial behaviour and noise nuisance”, before noting that “I expect them to use those powers effectively…I challenge local authorities to consider using it [Order 2011] and other antisocial behaviour powers, as well as the powers in relation to noise and environmental health that are currently at their disposal.”[3]
In terms of background:
To again quote the Minister formerly in charge of short-term let regulation, Kevin Stewart MSP: “The [ASB] powers may not be being applied properly, which might be the difficulty in all this…Under the order that I mentioned, the antisocial behaviour notice is served not on the people in the property who are causing the problem but on the landlord. That is extremely important. Folk having left a property should not affect in any way, shape or form the serving of a notice on the landlord.”[1]
More recently, the Cabinet Secretary for Housing Shona Robison MSP stated that “We expect all relevant authorities to use the powers available to them to deal with antisocial behaviour”.[2]If councils are not utilising these powers, they need to explain why and also whether they think the Scottish Government’s legislation is deficient, with a view to getting this strengthened for the benefit of local residents. The Scottish Government state they have no plans to review the Antisocial Behaviour Notices (Houses Used for Holiday Purposes) (Scotland) Order 2011 but are “always open to listening to the police, local authorities, the court services and communities to see how we can improve the approach being taken to tackle antisocial behaviour for the benefit of all communities.”[3]
In July 2021, the ASSC submitted Freedom of Information requests to all thirty-two local authorities in Scotland to ascertain:
The ASSC’s FOI requests of local councils show there is a mismatch between perception and reality: the number of ASB complaints against holiday lets in Scotland over the past five years is minimal.[4]
The ASSC believs that existing anti-social legislation needs to be enforced. In addition, the Scottish Government and local authorities could encourage or enforce noise monitoring in all accommodation where required to evidence a problem and assist in deployment of ASB. The ASSC suggested this as a solution as far back as 2017 as part of the Forward Together: A Collaborative Approach to Short-Term Letting policy paper.
In light of the revisions already made, what is the general interest that is being protected that is not already being protected by existing legislation?
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Illegal Activity
The Scottish Government’s BRIA makes a staggering assertion regarding how short-term lets are used, stating that they have been utilised “for criminal enterprises (such drug dealing, sex trafficking etc.), with or without the collusion of the host”.[1] To professional operators who pride themselves on their business, this was insulting to say the least.
Police Scotland’s Evidence Submission to the Scottish Parliament Local Government, Housing and Planning Committee meeting – 14th December 2021[2] states: “The Police Scotland National Interventions Unit have confirmed there is intelligence or anecdotal evidence that;
In terms of Innkeeper, the Police Scotland Licensing Database, there is no information recorded on this system in relation to short term lets.”
Police Scotland reference that “The predicted influx of applications will also present challenges in terms of police processing. Police Scotland are keen to ensure that thorough enquiries into applications are conducted and no opportunities missed to prevent the infiltration of Serious and Organised Crime Groups into the industry.” They request an extension of the timescales for submission of objections or representations in order to administer applications. This will further lengthen the process for law-abiding, legitimate businesses. This seems excessive, given the lack of any evidence and being based entirely on “potential for criminality in the sector”.
Meanwhile, self-caterers have been subjected to vigilante groups, online trolling and bullying campaigns against legitimate short-term let operators in both Edinburgh and elsewhere in Scotland due to the increasingly negative narrative. We have been provided with a specific contact and reference number from Police Scotland to log these issues. Evidence of this can be provided if required.
What evidence is there of charged incidences of criminality, or convictions brought against self-catering or B&B businesses associated with illegal guest activity?
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Other Issues to Consider
The ASSC’s short-term let consultation response (2021) comprehensively sets out all of our concerns in respect of the licensing proposals.[3] We would encourage you to consider this substantive evidence. We have the additional following points to raise:
Equal Opportunities: Impact on Women
Impact on Tourism
The ASSC contends that the short-term let licensing proposals do not align with ambitions for more sustainable tourism, the National Tourism Strategy, the National Performance Framework, the Covid-Recovery Taskforce, or the Principles Agreement between Scottish Government and Business.
Sustainable Tourism
Alignment with National Tourism Strategy: Scotland Outlook 2030
Alignment with National Performance Framework
Covid Recovery: Alignment with The Scottish Government Recovery Task Force
Principles Agreement between Scottish Government and Business
In December 2021, the Scottish Government signed a Principles Agreement with business organisations that: “Recognises the success, health and growth of this diverse and dynamic business community is fundamental to Scotland’s future economic prosperity and wellbeing… this agreement sets out the principles which will underpin genuine partnership working between the Scottish Government”[3] and business and tourism organisations. These organisations also wrote to the Scottish Government back in 2020 highlighting the potential damage to our sector and calling for a reconsideration of the short-term let regulations. That is in complete contrast with this piece of legislation.
Key Questions
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The Solution: Exemption for Registered Accommodation
Overall, we would argue that this proposal allows for a suitable compromise between differing positions: the Scottish Government can introduce licensing but exclude registered accommodation. This approach recognises the intention to regulate short-term lets through a licensing regime to protect health and safety but achieves the same policy objectives in a more proportionate and cost-effective manner for those already complying with the proposed mandatory licensing conditions.
Other Benefits the Register could Deliver
It becomes the instrument which owners and managers can utilise to make a formal declaration that they are operating within existing legal compliance, and adhering to the industry Code of Conduct. In this respect ‘Registration’ offers far reaching benefits:
Audit and Verification Processes
The ASSC Exemption: Benefits for Stakeholders
Overall, the exemption proposal assures the appropriate regulatory balance, providing the following benefits for government, professional and amateur operators, tourists, and local communities.
Legal Support for the ASSC’s Proposal
The exemption proposal has legal support from Hazel Moffat, Head of the Public Law & Regulatory Division of Burness Paull. As background, Hazel Moffat was appointed to the Scottish Parliament’s Non-Government Bills Drafting Panel to assist Committee and members with the drafting of Bills. She has stated the following:
“The exemption proposals seem to me to be worthy of serious consideration. The current drafting, though this inevitably may need further refinement, is simple and on the face of it effective. It introduces a simple alternative of registration which would help address some of the underlying legal concerns with the current licensing regime being entirely disproportionate and unnecessary when looking at the specific policy objectives as well as costly and unworkable from an operational perspective. Having one central registrar also mitigates against any inevitable inconsistencies and inequities across the country which can often be the cause of discontent and legal challenges.”
Scottish Government Response to Exemption Proposal
In the 2021 BRIA, the Scottish Government says it has “carefully considered” both the more full registration scheme proposal and the second, narrow exemption proposal. It then proceeds to dismiss both with minimal reasoning. The focus as stated in the BRIA has been on “do nothing” or “enact the Order as drafted” (paras 56 and 57). In particular, on the exemption, it simply says if it does not mirror the exact conditions of licensing then it doesn’t fulfil Ministerial policy objectives. If it does, then there has to be an assumption that the administration will be more efficient if delivered by local authorities, which frequently carry out licensing. That is the extent of the analysis which can hardly be considered robust or indeed careful.
Legality of the Scottish Government licensing scheme – and how registration could mitigate against outstanding concerns
The ASSC has previously submitted evidence regarding various legal considerations pertaining to this legislation which appear to have been disregarded or ignored[1].
Introducing legislation to provide the data to support the need for legislation[2] is not consistent with the principles of Better Regulation. Justifications for imposing policy and regulatory restrictions on short-term accommodation rental services must be supported by clear evidence that the general interest needs to be protected, and evidence of the link between short-term accommodation rental services and the protection of the general interest.
The Scottish Government has failed to properly address underlying legal issues with the licensing scheme. In particular Annex 5 of the BRIA highlights some of the concerns raised by ASSC but overlooks other significant issues raised. The following legal points made by ASSC have not been replied to in any great detail, but that could be mitigated if registration / exemption for registered accommodation is re-considered:
[1] https://scottishtourismalliance.co.uk/wp-content/uploads/2020/10/Tourism-Task-Force-recovery-plan.pdf
[2] https://scottishtourismalliance.co.uk/wp-content/uploads/2020/10/Tourism-Task-Force-recovery-plan.pdf (page 32)
[3] https://www.gov.scot/binaries/content/documents/govscot/publications/agreement/2021/12/principles-agreement/documents/principles-agreement-between-scottish-government-business/principles-agreement-between-scottish-government-business/govscot%3Adocument/principles-agreement-between-scottish-government-business.pdf?forceDownload=true
[1] https://www.gov.scot/publications/short-term-lets-licensing-scheme-planning-control-areas-consultation-analysis/documents/
[3] Other responses included three-way partnerships, 70/30 female/male, whole business 50/50 but self-catering element female
[5] Letter to Cabinet Secretary for Housing from Scottish Tourism Alliance, 30th September 2021
[1] https://www.gov.scot/publications/short-term-lets-licensing-scheme-planning-control-area-legislation-draft-business-regulatory-impact-assessment-bria/pages/2/
[3] This can be accessed here: https://www.assc.co.uk/policy/assc-response-to-third-scottish-government-short-term-lets-consultation/
[1] Ibid
[2] Shona Robison MSP, in answer to Parliamentary Question S6W-03022, 01/10/21. Url: https://archive2021.parliament.scot/parliamentarybusiness/28877.aspx?SearchType=Advance&ReferenceNumbers=S6W-03022&ResultsPerPage=10
[3] Shona Robison MSP, in answer to Parliamentary Question S6W-03021, 29/09/21. Url: https://archive2021.parliament.scot/parliamentarybusiness/28877.aspx?SearchType=Advance&ReferenceNumbers=S6W-03021&ResultsPerPage=10
[4] Further information on the FOIs are available from the ASSC on request.
[1] See here for more information: https://www.assc.co.uk/2021-short-term-let-consultation-responses/
[2] Email from Barry McCulloch, Head of Policy (Scotland), 13th December 2021
[3] Kevin Stewart MSP quoted in Scottish Parliament., Official Report, 08/11/17. Url: https://www.parliament.scot/api/sitecore/CustomMedia/OfficialReport?meetingId=11177
[1] https://www.lawscot.org.uk/media/369667/20-10-16-plan-lic-consultation-short-term-lets-regulations.pdf
[2] https://www.lawscot.org.uk/media/371436/2021-08-13-lic-short-term-lets-consultation-on-draft-licensing-order-and-business-and-regulatory-impact-assessment_-1.pdf, p4
[3] Parliamentary Answer S5W-34589. Url: https://archive2021.parliament.scot/parliamentarybusiness/28877.aspx?SearchType=Advance&ReferenceNumbers=S5W-34589&ResultsPerPage=10
[5] https://yourviews.parliament.scot/session-5/local-gov-sustainability-covid/consultation/download_public_attachment?sqId=question-2020-06-10-3171498657-publishablefilesubquestion&uuId=804853480
[6] Medium Term Financial Plan- Update 28th October 2021: https://www.highland.gov.uk/download/meetings/id/78893/9_medium_term_financial_plan_-_update
[2] Stephen McGowan is the author of Local Government Licensing Law in Scotland (2012), the only legal textbook on the Civic Government (Scotland) Act 1982 – under which the new licensing schemes will be adopted.
[3] https://www.assc.co.uk/potential-flood-of-licensing-applications-for-short-term-lets-in-glasgow/
[4] https://www.scottishlegal.com/article/licensing-expert-warns-of-flood-of-short-term-let-licences-1
[1] https://consult.gov.scot/housing-and-social-justice/short-term-lets-draft-licensing-order-and-bria/consultation/view_respondent?_b_index=360&uuId=526916605
[2] See here for the full text of the motion and further details: https://scottishtourismalliance.co.uk/tourism-bodies-back-highland-council-opposition-to-short-term-let-licensing/
[1] https://consult.gov.scot/housing-and-social-justice/short-term-lets-draft-licensing-order-and-bria/consultation/view_respondent?_b_index=600&uuId=472337303
[1] https://consult.gov.scot/housing-and-social-justice/short-term-lets-draft-licensing-order-and-bria/consultation/view_respondent?_b_index=600&uuId=246870012
[1] https://www.gov.scot/publications/short-term-lets-licensing-order-update-letter-from-cabinet-secretary-LGHP-committee/
[2] https://betaproxy2.parlamaid-alba.scot/chamber-and-committees/written-questions-and-answers/question?ref=S6W-03023
[3] Page 29, Supplementary Guidance for Local Authorities
[4] https://www.assc.co.uk/over-provision-opinion-of-counsel/
[1] This was estimated by the Society of Local Authority Lawyers and Administrators in Scotland (SOLAR) during the stakeholder discussions at the Short-Term Let Working Group.
[2] Page 10, Supplementary Guidance for Local Authorities
[3] Page 13, Supplementary Guidance for Local Authorities
[4] Page 24, Supplementary Guidance for Local Authorities
[1] http://www.legislation.gov.uk/asp/2005/16/contents
[2] https://www.argyll-bute.gov.uk/law-and-licensing/licensing-standards
[3] http://www.legislation.gov.uk/ssi/2007/553/contents/made
[4] https://www.townheadhotel.co.uk
[5] https://www.lochmelfort.co.uk
[6] https://bespokehotels.com/arrocharhotel/
[7] https://www.scotsman.com/business/crerar-hotels-unveils-new-self-catering-site-at-glencoe-inn-3333395
[8] Scottish Government, Short term lets - licensing scheme part 1: guidance for hosts and operators (2021), p15. Url: https://www.gov.scot/binaries/content/documents/govscot/publications/advice-and-guidance/2021/06/short-term-lets-scotland-licensing-scheme-part-1-guidance-hosts-operators/documents/short-term-lets-scotland-licensing-scheme-part-1-guidance-hosts-operators/short-term-lets-scotland-licensing-scheme-part-1-guidance-hosts-operators/govscot%3Adocument/short-term-lets-scotland-licensing-scheme-part-1-guidance-hosts-operators.pdf
[9] https://www.scotsman.com/news/politics/pragmatic-and-significant-changes-to-licensing-scheme-for-short-term-lets-3412243
[1] Scottish Government, Short-term lets - licensing scheme and planning control area legislation: draft business and regulatory impact assessment (BRIA) (2021), p6. Url: https://www.gov.scot/binaries/content/documents/govscot/publications/impact-assessment/2021/06/short-term-lets-licensing-scheme-planning-control-area-legislation-draft-business-regulatory-impact-assessment-bria/documents/short-term-lets-licensing-scheme-planning-control-area-legislation-draft-business-regulatory-impact-assessment-bria-consultation/short-term-lets-licensing-scheme-planning-control-area-legislation-draft-business-regulatory-impact-assessment-bria-consultation/govscot%3Adocument/short-term-lets-licensing-scheme-planning-control-area-legislation-draft-business-regulatory-impact-assessment-bria-consultation.pdf
[2] https://www.gov.scot/publications/short-term-lets-licensing-order-update-letter-from-cabinet-secretary-LGHP-committee/
[3] https://www.assc.co.uk/tourism-accommodation-business-survey/
[1] Parliamentary Answer S5W-34474. Url: https://archive2021.parliament.scot/parliamentarybusiness/28877.aspx?SearchType=Advance&ReferenceNumbers=S5W-34474&ResultsPerPage=10
[1] For further information on housing issues, please consult: https://www.assc.co.uk/policy/housing-and-short-term-lets-in-scotland-the-facts/
[2] Our response to City of Edinburgh Council’s proposal for a city-wide Control Area can be accessed here: https://www.assc.co.uk/assc-submission-to-edinburgh-city-council-short-term-let-control-area-consultation-response/
[1] https://www.assc.co.uk/wp-content/uploads/2021/08/Economic-Impact-Study-%E2%80%93Scotland-Report.pdf
[2] This is evident in both the Scottish Government’s BRIA accompanying their licensing proposals, as well as City of Edinburgh Council’s plans for a short-term let control area.