The answer to a question asked in the House of Lords about tenancy deposit schemes has confirmed that all three approved schemes will run until the end of March 2012.
Whilst the revelation will come as no surprise to readers of Estate Agent Today, who had already seen this information on our site, the question and answer add to the mystery as to why a three-year initial contract now appears to run for six years.
One source told EAT that the three-year break clause had been accidentally omitted. However, another said that because all three schemes had breached Key Performance Indicators, there was nowhere else to go.
Baroness Byford asked whether the contracts governing the independent arbitration of the three tenancy deposit protection schemes would be extended from this April.
Replying, Lord McKenzie of Luton, who is a parliamentary under-secretary of state at CLG, said: “The Department for Communities and Local Government’s contracts with the three tenancy deposit protection scheme providers for the provision of tenancy deposit protection schemes will run until the end of March 2012.
“Under the contracts, the individual scheme providers make their own arrangements for the arbitration of disputes.”
A TDS board meeting is to be held tomorrow (Tuesday) at which its massive price hikes will be discussed.
A second scheme, the Deposit Protection Scheme, has been asked to comment on the situation but declined our invitation through its PR firm, Mandate.
The third scheme, Mydeposits, was originally set up for landlords, but is now looking to recruit more agents.
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Comments
There is no ‘mystery’ here. The contracts awarded by CLG were for five years, not six. They run from April 2007 – March 2012. When awarded, the five year contract had a three year break clause based on the key performance indicators (KPIs) being met. Certainly in mydeposits case, the three year break clause has not needed to be evoked as all KPIs have been met (despite what the unnamed source in the article says!). CLG will be able to confirm this.
Finally, mydeposits was not originally set up just for landlords. The scheme was specifically designed to allow landlords to hold on to their tenant’s deposit, but never excluded letting agents also wishing to do the same. Letting agents have always been able to use mydeposits – and do!
Isn't end March 07 to end March 12 only 5 years ?