When on 15 January 1989 the Housing Act 1988 came into force in England and Wales, this (along with the Assured Tenancy) became the main form of tenancy of residential premises in the private sector and is still in use to this day. In fact, if you rent your home now in the UK, chances are this is what sort of tenancy it's on.
It is almost a complete opposite to the previous Rent Act tenancy that it replaced. Whereas that form of tenancy was almost indestructible and subject to severe rent controls that were described as "expropriation without compensation," the Assured Shorthold tenancy is basically a fixed-term let, and security of tenure only exists so long as the term is still ongoing. Furthermore, it is subject to no rent controls beyond what in statute is called a "market rent." Furthermore, the rent can be put up either by agreement or by unilaterally serving on the tenant a notice in the prescribed form, or even by inserting into the tenancy agreement a clause for an annual rent review, usually based on the interest rate of the landlord's bank, or the Retail Price Index, or similar.
An AST is a fixed term let in that during the term of the tenancy, the tenant can only be evicted if one of the 16 "grounds" in Schedule 2 to the Housing Act 1988 are made out, and if the landlord then serves the correct notice in the correct form and then issues proceedings in Court for a possession order. Eight of these grounds are "mandatory," in that the Court must make a possession order if it is satisfied that they apply, and eight are "discretionary" in that the Court can make a possession order or not depending on whether it is reasonable in all the circumstances. Breach of tenancy term or condition is a discretionary ground, as is rent arrears, but, if there are eight weeks or two months' rent arrears both at the service of the notice and the Court hearing, that is a mandatory ground for possession, known as Ground 8. Compare the Rent Act, which not only required the landlord of a tenant even in severe arrears to show it was reasonable to evict that tenant but also to be satisfied of the possibility of obtaining suitable alternative accommodation. As a result of this, it is a lot harder for tenants in arrears to avoid eviction from an Assured Shorthold Tenancy.
Furthermore, once the tenancy is up, the landlord and tenant can either enter into a further agreement for a fixed term or allow it to continue on a periodic basis. During this period it is still possible to regain possession for a ground, but also, the landlord can, for any reason, serve a two month "Section 21" notice, expiring at the end of a period of the tenancy, that is, expiring the day before the rent becomes due next two months hence (i.e. if the rent was due on the 5th of each month, a section 21 notice served today would expire on 4 February 2012), and then issuing Court proceedings and the Court would then make a possession order, possibly even on the papers and without a hearing, should it be satisfied the correct notice is served and that the deposit is protected. Security of tenure is therefore severely abrogated once the fixed term is up.
(The Assured Tenancy, incidentally, which is like an AST but without the fixed-term security and instead conferring indefinite security, is often used by Housing Associations and the use of Ground 8 is, to say the least, controversial, as council tenancies, which Housing Association tenancies are supposed to mimic, do not have this ground. See the case of Weaver v. London & Quadrant Housing Trust for more information. Also the use by them of ASTs as a form of "probationary period" for new tenants where there's concerns over anti-social behaviour or persistent rent arrears is also controversial.)
The idea of introducing this rather than the Rent Act tenancy was to try to encourage people to let out their empty properties which were effectively unrentable due to the house price boom of the 1980s. By allowing landlords to charge a market rent and also making it easier to get rid of bad tenants the idea was to encourage more letting. Unfortunately it now appears that the pendulum has swung a long way in the other direction from the Rent Act, and ASTs are now criticised for making renting privately very transient, as the landlord can, once the fixed term is up, effectively tell you to sling your hook for any reason whatsoever. While in practice it would not necessarily be in the landlord's best interests to get rid of a tenant who pays on time and doesn't cause a nuisance, in these enlightened days of massive housing shortages especially in London and the South East it's not uncommon for a landlord to demand rent increases and then get rid of anyone who refuses this using the Section 21 two-month notice as set out above, thinking that there'll surely be someone who can afford to pay more. I for one find it's best to conveniently "forget" to remind the landlord that the deposit needs to be protected then ambush him with it if he wants me out and issues Court proceedings for possession.
I doubt that security of tenure will increase though. Landlords would be up in arms at a time when the Government is putting ever more emphasis on private renting to house everyone in Britain. I could possibly, if I were a landlord, get behind increasing residential tenants' security of tenure so long as there were provisions to speed up (i.e. force the Courts to get their finger out on) evictions for tenants in arrears on mandatory grounds. Possibly by classing mandatory-ground repossession claims as priority hearings so that there's the minimum 14 days between service of the claim and the initial hearing, much like is done with interim possession orders and injunctions. However I do not run Her Majesty's Courts and Tribunals Service so this I cannot do.
(IRON NODER 2011, 26/30)