One in five tenants fail to safeguard their deposit

One in five private renters in Scotland have put down an unprotected deposit on their tenancy in the past five years, despite a series of government-approved schemes set up to safeguard their money.

Nearly a third of renters lose some of their cash. Picture: Ian Georgeson

A Scottish Government review of the tenancy deposit scheme found nearly one in three people did not have their deposit returned in full, with the vast majority of those not pursuing a dispute process.

A leading tenants’ union told Scotland on Sunday people are waiting five months to receive their money due to a system which “isn’t good enough”.

The review marks the first analysis of the deposit initiative since it was rolled out seven years ago in an attempt to put a stop to landlords and letting agents holding on to tenants’ money on false grounds. Instead, the money is transferred to approved third party companies.

However, the experience of renters who took part in the review indicates that the regulations are not being adhered to, with 20 per cent of tenants, especially those with children, renting a property in the past five years where the deposit was not protected.

Some 32 per cent of renters said they did not receive the full deposit back for a previous tenancy, while 19 per cent said their deposit was not returned on time.

Summarising the effectiveness of the changes, the report states: “There is a broad consensus that the tenancy deposit scheme regulations continue to provide a robust regulatory framework for the protection of tenants’ deposits and the conditions for the operation of the schemes.”

Gordon Maloney from the Living Rent tenants’ union said: “It is crystal clear that the tenancy deposit system right now still isn’t good enough and Living Rent will continue to hold rogue landlords and letting agents to account when they try to rip off our members.

“Tenants often have to wait up to five months to get their deposits back, but with the costs of renting already as high as they are, people simply can’t wait that long. The process urgently needs sped up. We also routinely see landlords make outrageous, fraudulent claims on tenants’ deposits.”

James Mullaney, private renter capacity building officer at Shelter Scotland, said that while the initiative had been “fairly successful” in rebalancing the power between landlords and tenants over deposits, there were problems.

He said: “We know there are still many private renters who are unaware of their rights when it comes to tenancy deposits and, in our experience, there is still a significant number of renters who have not had their deposits protected – which is unlawful.

“It is also concerning that a high number of households – particularly those with children – have not benefited from the tenancy deposit regulations.”

Mullaney added that tenants could seek redress via the First Tier Tribunal if their deposit was not protected.

Liam McCabe, president of NUS Scotland, added: “It’s clear from the report that one-third of tenants were not comfortable with or aware of the dispute process available should their landlord withhold their deposit.”

Some 7,969 tenants completed surveys as part of the review. Official statistics show there are 393,000 private rented properties in Scotland.