The white paper on rent law reform has finally been published, having been in the pipeline for so many years. So much so, that the Prime Minister felt he had to explain that it was practically ready last October but that in view of the pending election he had decided to postpone its publication, as he did not want anyone to interpret it as some election gimmick.
The white paper is a good attempt at a compromise between the absolute right of ownership claimed by landlords and the notion of security of tenure that is enjoyed by tenants. As a compromise, it probably fails to satisfy fully the expectations of both sides and it would hardly qualify as the sort of election gimmick that seeks to give everything to everybody!
I am tempted to use the worn out cliché: ‘better late than never’ but, even so, the proposed action is being taken so late that I do not really blame those who had concluded that matter had been actually thrown in Government’s ‘never-never’ tray, considering that recent PN administrations had procrastinated so much over it.
The last time the rent laws were amended was over 13 years ago: in 1995, when the rent market was completely liberalised as far as new titles were concerned but left all existing titles as they were: regulated with a draconian law that allowed the state to interfere in the rapport between landlord and tenant in a way that this relationship was heavily biased against the landlord. Unfortunately, the 1995 amendments did not bring about the desired resurgence of the rental market, mostly because property owners saw those amendments as having been supported only by the PN.
Many still feared that a future MLP government could resort to reapplying the rules that were originally justified by the housing shortage in the wake of the destruction wrought in World War II. Chief amongst these were the freezing of rents at 1939 levels and the requisition powers that the state gave itself. Fifty years of requisition orders, including a very high dosage of abuses and injustices, left a collective trauma that property-owners cannot overcome without a whole-hearted bipartisan agreement on a reform that is tantamount to the re-founding of a liberalised real rental market.
Like many, I am disappointed with the MLP’s weak and confused reaction to the white paper. I expected the MLP – under its new leader – to declare whether it agreed with the principles that inspired the white paper’s recommendations; and then to study these recommendations and suggest improvements wherever thought necessary. Instead, without committing itself in any way, the MLP has simply declared it will be seeing what the people want, as if it is going to hold a separate consultation exercise in parallel to the official one launched by the publication of the white paper. Refraining from taking up a clear and definite position on such an important issue as rent law reform, does not make for a new political season and is not what people were expecting of Joseph Muscat.
In recognizing the need for a gradual liberalisation of the rental market without undue shocks to the social fabric, the white paper also exposes the superficiality and the naïveté with which Alternattiva Demokratika (AD) had attempted to force a referendum on the issue. I had openly criticized AD on the way they were just proposing to abrogate the law without replacing it with any new policy. This would have left a legal and moral vacuum leading to new injustices and a big social mess. Many probably realised this and this could be the reason why AD failed to gather the number of signatures required to force a referendum on the issue. AD’s tactic also had a very big pitfall: had a referendum resulted in a majority against abrogating the existing law, gradual reform of the law would have been actually postponed.
It is rich for AD to comment now that the white paper does not take into consideration certain social realities like one-parent families and same sex couples. Apart from the fact that it is the existing laws that do not take into consideration these realities, in practice this means that AD has suddenly switched from a policy of removing all kinds of protection to tenants to one that seeks to give privileges and protection that does not exist in the law as it is today.
Some – including AD – have criticised the fact that the white paper excludes any action regarding rents of clubs, including political clubs. I think this was a big mistake on the part of government. It was obvious that there would be some who would react to this by questioning whether the government was looking after the interests of political parties so that these will be allowed to hold on to the existing protection that they might be enjoying in the case of party clubs. The Nationalist Party has now declared that it is not seeking any such protection and that it is prepared to forego it. This was a storm in a teacup that has shown again the inherent weakness in government’s public relations strategy, that is not capable of seeing such an obvious reaction coming. The reference to political clubs in the white paper could – and should – have been avoided.
A policy about the titles of rent held by all sorts of clubs should have been included in the white paper. In any case, this should be part of the law that will set up the mechanism of the proposed reform mechanism. After all, there is no reason why landlords owning property let to band or sports clubs – let alone political clubs – should keep on suffering any injustices.
I have always believed that switching from the existing regime that regulates all titles of rent that existed before 1995 to a fully liberalised market was a very delicate exercise as removing existing injustices rashly could lead to new injustices. The white paper seeks to find a way how to liberalise the rental market gradually while keeping in mind that the full and complete liberalization of this market is a long term objective. Renting asunder the landlord-tenant relationship is no easy task.
Many people who have a personal interest in the matter will probably disagree with what is being proposed. Some will maintain it is not enough while others will say it is too much. That is in the nature of all compromise solutions. The white paper provides a very good base for discussion. No doubt the proposed reform will be honed and fine-tuned after the period of public consultation.
Whatever its faults, the proposed reforms are a step in the right direction and there is certainly nothing sinister behind government’s proposals.