Residential Tenancies Amendment Bill: Select Committee report back

Tagged with:

  • News
  • Residential Tenancies Act Reform

The Residential Tenancies Amendment Bill (the Bill) is currently before Parliament. The Social Services and Community Committee has now reported back to the House. The Committee decided, by majority, to recommend the Bill to the House, and to make a number of changes to the Bill.

These changes include the introduction of a new exemption which clarifies the law affecting emergency and transitional housing.

Why the RTA is being clarified?

The underpinning rationale for this proposed legislative change is that people are staying longer in emergency and transitional housing than was previously the case.   Despite best efforts to move clients into permanent accommodation, some tenures exceed what the Act was designed around.

What is included in the exemption?

These changes include the introduction of a new exemption that affects emergency and transitional housing. The proposed exemption provides that the Act does not apply where premises are used to provide emergency or transitional accommodation that is either:

  • funded wholly or partly:
    • under the Special Needs Grants Programme; or
    • by a government department as emergency or transitional accommodation for people in need of housing; or
  • where the accommodation provider is a person, or kind or class of person, prescribed by regulations made under the Act.

However, the exemption does not prevent providers from agreeing to any of the provisions of the Act applying that are appropriate for their service, either without modification or with such modification as they consider appropriate.

Next steps

The new exemption will come into force on the day after the Bill receives Royal Assent. It will apply from that date to all people in qualifying transitional and emergency housing, including both existing and new clients.

Once the Bill is passed, we will engage with the sector and other agencies to develop the Code of Practice that will be reflected in transitional housing contracts.

For more information on the Residential Tenancies Act reform in general, visit the Ministry of Housing and Urban Development’s website: www.hud.govt.nz/RTA-Reforms.

Residential Tenancies Act 1986 Reform Announcement Frequently Asked Questions – report back from Select Committee

What has happened since the Bill was introduced?

The Residential Tenancies Amendment Bill (the Bill) has progressed through Select Committee (the Committee), where there was an opportunity for the public to make a submission on the Bill. 1,436 submissions were received. The Committee examined the Bill and agreed (by majority) to make a number of changes and to recommend the Bill to the House.

What changes were made in Select Committee and why?

A number of changes were made in Select Committee. These are briefly explained below. For a full report on the recommendations, please see the Departmental Report.

Security of tenure

A number of changes were made to clarify the termination grounds and to ensure their workability:

  • where a landlord or family member is to move into the premises, they must intend to move in within 90 days of the termination date.
  • where the premises are to be converted to a commercial use, the premises must be used for this new use for at least 90 days.
  • where there is intended renovation or demolition of the premises, the landlord must intend to begin, or take material steps towards, renovation or demolition within 90 days of the termination date.
  • The meaning of “termination date” was clarified to mean the date provided for by the landlord in the termination notice.

There were several changes to situations where a landlord needs the premises for an employee. The existing termination ground was amended to include contractors as well. A termination ground was included where the landlord is the Ministry of Education, and the intended tenant is employed or contracted by a school Board of Trustees. This addresses this situation where accommodation is commonly provided by a landlord who is not also the employer.

In addition, the termination grounds relating to social housing tenancies were modified to more closely reflect the Public and Community Housing Management Act 1992. These changes include:

  • clarifying that the Tenancy Tribunal does not have jurisdiction to review a social housing provider’s reasons for transferring a tenant, as existing pathways should be used instead.
  • clarifying that the termination grounds do not affect existing social housing transfer processes.

The Bill also clarifies that where a tenant challenges a notice of anti-social behaviour in the Tenancy Tribunal, the landlord must prove the behaviour occurred. This is consistent with the process if a landlord makes an application to terminate a tenancy on the basis of three anti-social behaviour notices. It also reflects the difficulty for the tenant in proving a negative.

Fibre

The landlord has various exemptions from the general obligation to permit fibre installation. One of the exemptions was removed – where the installation requires the consent of a third party and the landlord or network operator is unable to obtain that consent. This exemption duplicates existing processes in the Telecommunications Act 2001, which is sufficient.

The Bill makes minor changes to other exemptions relating to where installation would compromise the weathertightness or the character of the building. These exemptions now require that the weathertightness or character must be “materially” compromised. This is to avoid permitting exemptions for negligible or minor impacts.

An exemption relating to where the installation of fibre would impede the landlord from undertaking renovations of the premises was modified. In order to qualify for this exemption, the landlord must intend to begin or take material steps towards, renovation within 90 days of the request for fibre. This is to avoid permitting exemptions where the landlord doesn’t need the exemption as they do not intend to begin renovations for a long time.

Rent setting

An exemption from the requirement to state the rent when advertising or offering service tenancies was added. Service tenancies often offer a tenancy as part of the full remuneration package of employment, so it would not make sense for the employer/landlord to portion out part of the remuneration as being for rent.

Access to justice

A provision to provide for automatic name suppression where the Regulator takes a case on behalf of a party was added. This is because the party may not be aware, or may not always consent, where the Regulator takes a case on their behalf.

Assignment and break lease fees

An obligation that landlords must respond to assignment requests in writing within a reasonable period of time was added. This obligation is only triggered where tenants make an assignment request in writing and identify and provide the contact details for a potential assignee. This makes this provision consistent with other provisions that require landlords to respond to requests (such as tenant fixtures). It was made an unlawful act for a landlord to fail to comply with this requirement without a reasonable excuse.

Enforcement

The family portion of the associated person test was narrowed to only include spouses and partners. This is to recognise landlord submissions that the broader test would capture people they have no business relationship with.

A technical change was made to the test for calculating how many tenancies a landlord has so as to not capture landlords that were unintended to be captured.

It was clarified that if a landlord with six or more tenancies is given an infringement fee set at the rate for landlords with five or fewer tenancies (a lesser fee), that fee is still valid.

An unlawful act was added to give enforcement power to an already existing obligation. It was made an unlawful act for the landlord to fail to provide the landlord and tenancy related minimum information requirements of a tenancy agreement. It is not an unlawful act for a landlord to fail to provide the information that is purely tenant related.

Records of gas work and plumbing were added to the documents that landlords are obliged to retain. Records of “building work” was modified to “building work that requires a building consent” as this better matches the policy intent and produces lower compliance costs for landlords.

A requirement to consult with the Ministry of Justice before officials recommend creating infringement offences by regulation was added.

Transitional and emergency housing

Additional provisions were added clarifying the status of transitional and emergency housing under the Residential Tenancies Act 1986. These are set out in more detail below.

What are the changes to transitional and emergency housing?

What does the Bill say about transitional and emergency housing?

The Bill clarifies that emergency and transitional housing can be exempt from the Residential Tenancies Act 1986 (RTA), where this housing is funded either by a government department or under the Special Needs Grants Programme. 

There is also provision for the exemption to be extended to other specified providers, where the Government is satisfied that the appropriate checks and balances are in place. The exemption can be extended to other providers through the Government making regulations.

Why have these changes been introduced?

This exemption clarifies the legal position of these services, some of which currently operate as if the RTA applies, but some of which do not. There is an existing exemption in the RTA for temporary or transient housing, but the extended lengths of time that some clients are now remaining in these services makes it unclear where the exemption does and does not apply. 

A number of aspects of the RTA will change as a result of the Bill, and what worked for some providers before may no longer be workable once the proposed Bill passes and comes into force. 

Emergency and transitional housing is a short-term safe place to stay while longer-term accommodation can be found. While current shortages in the housing market mean that some clients are staying in these services for longer than before, that does not change the nature of the service being provided.

Requiring full compliance with the RTA would often not fit well with the way transitional and emergency housing is delivered and would risk reducing the availability of these services. The new exemption helps ensure that providers can continue to provide this valuable service to people who need a safe place to stay. 

Does this apply to people who are currently in transitional and emergency housing?

The new exemption will come into force on the day after the Bill receives Royal Assent. It will apply from that date to all people in qualifying transitional and emergency housing, including both existing and new clients.

Can transitional or emergency housing providers choose to be bound by the Residential Tenancies Act?

Yes. The new exemption clarifies that qualifying services are not required to be bound by the RTA. However, providers can still ‘contract in’ to those elements of the RTA which do fit with their service, and they are encouraged to do so. To contract into the RTA, the provider and client will need to agree in writing which elements of the RTA apply.

What is the process from here?

The Bill will have its Second Reading, where the Bill and the amendments recommended by Select Committee will be debated. If the Bill passes its second reading, it will go to the Committee of the Whole House, where it will be debated in detail. The Bill will then have its Third Reading. If the Bill passes its third reading, it will subsequently receive Royal Assent.

We will continue to provide information throughout the process.

Published: July 8, 2020

Top
Top