Editorial | Wednesday, 24 June 2009

Rent reform – an ominous silence

With hardly a squeak from any quarter, the Bill before parliament to reform rent legislation has been blessed with the approval of Parliament at the Committee Stage and now only awaits its final appearance before the House at its Second Reading to become law following Presidential assent. In view of the fundamental impacts this law can be expected to have, such a non-reaction is nothing less than astounding.
While we have been kept busy weighing whether or not Joseph Muscat did well to apply for a refund of VAT on his own family car, Jeffrey Pullicino Orlando’s performance at Mistra and discussing the outcome of the EP elections, there has been no controversy over the proposed reforms at this latest stage.
It appears that both of the political parties in parliament are keen to keep a low profile on this one. The PN under pressure from the Greens for the past five years or so was obliged to cough up some sort of reform following the 2008 election when its policy became to take over every issue ever championed by Alternattiva Demokratika. The PL likewise aimed to occupy the Green space and has the advantage of leaving it to the PN in office to take the initiative on this thorny issue. Perhaps the PL’s disadvantage is that it must shed its reputation on this issue and the memory of punitive requisitions carried out in the 1970s and 1980s. At the same time the PL feels obliged not to be seen to have abandoned its core altogether. Keeping a low profile suits everybody.
Or does it? John Dalli appears to have pulled all the stops to come up with a Bill where his predecessor had promised a white paper on rent reform and failed to deliver. The final product has been a change in our law which can be expected to have massive economic, social and environmental impacts produced without the necessary socio-economic impact assessment, without an expert assessment of its legal efficacy and without the constructive public debate such a shifting of tectonic plates deserves.
There can be no question that a change had to be made to address the 60 year injustice to the owners of 20,000 properties subject to pre-1995 rents many of them at 1939 rents. The question is have the changes been made?
The major issues for the expropriated owners is how soon can they have their properties back and can they end the infamous inheritance of leases which has crippled them so far? In both cases the reform offers hope, some hope and plenty of false hope. If our legislators were to be combined into a metaphorical Solomon, this Solomon instead of threatening to carve an infant in two to satisfy two women each claiming to be the mother has jumped the gun and actually carved the baby up offering the remains as a fair compromise to all parties concerned.
Instead of aiming to create a fair and free market in view of the oversupply of properties of all sorts, the Bill takes as its priority the lessening of uncalculated and possibly incalculable impacts. Owners will recover their assets depending on a variety of elements: whether the property is subject to a residential or commercial lease, the age of the tenant etc etc. Instead of an even playing field, we have a lottery disguised as the rule of law.
If viewed from the perspective of our legislative tradition in this sector over the past 60 years and more, this reform is no reform at all. It acknowledges that unsustainable pressure has built up from the inaction of legislators over several decades and concedes a small and in some cases, ineffective change. Unlike all its predecessors before the 1995 change in the law, this one is far more scandalous since it takes place in the face of a separate, free rental market.
Perhaps the lack of reaction is due to the fact that many landlords have learned utter helplessness in the face of government while others on reading the proposed reform found it so far from reasonable that they are awaiting its enactment in silence only to challenge it in court as a violation of their rights under the constitution and under the European Charter.



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24 June 2009

Malta Today


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