The Campaign For Client Money Protection Continues
On 10 December 2015, the final day that the Public Bill Committee looked at the Government’s Housing and Planning Bill 2015, ARLA’s proposed amendment (supported by NAEA) to make membership of a Client Money Protection scheme compulsory for all letting agents was withdrawn.
In the Public Bill Committee, Teresa Pearce MP moved the clause and referred to industry support for the amendment. She mentioned ARLA’s belief that client money protection is fundamental for tenants and landlords to ensure that they have peace of mind should an agent go bust or take with their funds.
At the meeting Brandon Lewis, the Minister of State for Housing and Planning, said he was aware of support for the new clause but was concerned that requiring letting agents to belong to a client money protection scheme could introduce significant costs and implications for the sector.
The Minister added that introducing a mandatory client money protection scheme would be a step too far and would overburden the market.
Could there still be a glimmer of hope?
However, Mr Lewis did say that he has taken the comments on board and in May 2016 he will review the impact of the transparency measures that were recently put in place. He then subsequently asked for the amendment to be withdrawn.
In a letter addressed to David Cox, Managing Director of ARLA, on 11 December 2015 Brandon Lewis reiterated his stance and said he would consider whether further action is needed. In his letter the Minister outlined that he recognises the importance of Client Money Protection, but believes that the fee transparency measures contained within the Consumer Rights Act 2015, coupled with existing consumer protection rights meant that the balance of regulation for letting agents is currently about right.
Commenting, David Cox said:
“It’s a real shame that the amendment was withdrawn. We’ve been fighting this battle for 20 years and we’ll continue the struggle until Westminster falls closer in line with the devolved administrations.
“Hopefully, the Minister will stick to his word and review the impact of the transparency measures that were put in place recently and look to see if any further measures are needed, such as the need for mandatory Client Money Protection.
“The petition to ensure MPs fully understand the importance of this issue is still live and I would urge everyone to sign it in order to keep the pressure on and force the change which will provide greater protection for tenants and landlords if things go wrong.”
The Campaign For Client Money Protection Continues
Property & Development Magazine