Key statistics note published for Cost of Living Bill

The Scottish Government published a note of key statistics underpinning the Cost of Living (Tenant Protection) Scotland Bill on 10 November 2022¹. The Bill was introduced to the Scottish Parliament on 3 October 2022¹. The note summarises the evidence used in developing the legislation, covering housing costs, incomes, financial vulnerability, fuel poverty and poverty rates by housing tenure¹.

On housing costs, the note says people in the private rented sector have spent the highest proportion of their income on housing (26%) of all tenures since 2006/07, compared with 24% in the social rented sector¹. For owner occupiers with a mortgage, the average proportion of income spent on housing fell from 12% in 2006/07 to 7% in 2019/20¹. Over 2017 to 2020, private rented households in the lowest income quintile paid an average of almost half (47%) of household income on housing costs, with the equivalent figure for social rented households in the lowest quintile at 38%¹.

The note reports that in 2019, 60% of social rented households and 38% of private rented households had a net income of £20,000 or less, compared with 14% of households buying with a mortgage and 41% of households who own outright¹. Over 2018 to 2020, 63% of social rented households and 40% of private rented households were estimated to be financially vulnerable, defined as having savings covering less than one month of income at the poverty line, compared with 24% of households buying with a mortgage and 9% of households owning outright¹. An estimated 9% of social renting households had unmanageable debt in 2018-2020¹.

On fuel poverty, the most recent National Statistics, from the 2019 Scottish House Condition Survey, estimated 613,000 households (24.6% of all households) were in fuel poverty, of which 311,000 (12.4%) were in extreme fuel poverty¹. Fuel poverty rates were similar for households renting from housing associations (39%), local authorities (36%) and private landlords (36%), compared with 12% of households with a mortgage¹. The 2020 survey did not take place because of Covid-19 restrictions, and the 2021 survey used a different approach, with key findings due in February 2023¹.

The note also sets out estimates of fuel poverty under the Energy Price Guarantee, which came into effect on 1 October 2022 with the price cap for the average dual fuel customer paying by direct debit frozen at £2,500¹. It estimates around 860,000 households (35% of all households) will now be in fuel poverty, with around 600,000 (24%) in extreme fuel poverty¹. These estimates account for UK Government support announced at the end of May 2022 and the Scottish Government's £150 Council Tax rebate for households in bands A to D or receiving Council Tax Reduction, and the note says they will have to be revised if further support is announced¹.

On poverty, the note says 39% of people in social rented households and 34% of people in private rented households were in relative poverty across 2017 to 2020, compared with 7% of people in households buying with a mortgage and 14% of people in households who own outright¹. For children, 47% in social rented households and 40% in private rented households were in relative poverty, compared with 10% in households buying with a mortgage and 18% in households who own outright¹.

On rents, the note cites ONS Private Rental Index figures showing the annual increase in private rents across all tenants in Scotland was 3.7% in July 2022, the highest since the series began in 2012¹. It notes these are experimental statistics incorporating an assumption of average tenancy length, and that the ONS series reports national level increases only¹. Separate letting agent data cited in the note shows Citylets reporting time-to-let down to 18 days in Q2 2022 from 40 in Q3 2020, and advertised rents in April to June 2022 up 15.1% in Edinburgh, 13.0% in Glasgow and 4.4% in Aberdeen on the same quarter a year earlier, while Rightmove reported advertised rents in Scotland up 12.5% over the same period¹.

Why it matters for households

The statistics describe the position of households in Scotland by tenure, and the note was published to accompany a Bill introduced on 3 October 2022¹. The figures on housing costs, low incomes, financial vulnerability and fuel poverty are highest for rented households, particularly those in the social rented sector and private renters on the lowest incomes¹. The fuel poverty estimates under the Energy Price Guarantee, in effect from 1 October 2022, cover all tenures and put 35% of all households in fuel poverty and 24% in extreme fuel poverty¹. The note states these estimates will have to be revised if further support is announced¹. The 2021 Scottish House Condition Survey key findings, including an estimate of fuel poverty rates and levels in 2021, are intended to be published in February 2023¹.

What happens next

The note states that the key findings from the 2021 Scottish House Condition Survey are intended to be published in February 2023, including an estimate of fuel poverty rates and levels in 2021¹. It also states that the fuel poverty estimates under the Energy Price Guarantee will have to be revised if any further support is announced¹. No further parliamentary stages of the Bill are set out in the note.