The Government have made good progress towards implementing statutory tenancy deposit schemes, which will apply to all assured shorthold tenancies, where a deposit is taken, in England and Wales.
There will be two types of scheme: a single custodial scheme, where deposits will be paid into and held in a separate account, and one or more insurance-based schemes, where the landlord or agent will hold the deposit and any failure on his/her part to repay it to the tenant will be covered by the scheme's insurance arrangements. Each scheme will offer an alternative dispute resolution service.
The schemes were originally due to be commenced on 1 October 2006. However, in a press release published on 23 June 2006 to accompany the publication of a summary of responses to a consultation document published in November 2005, the Government said that, in order to consider stakeholder concerns raised by that consultation, they had decided to review the commencement date and would confirm that date before Parliament rose in the summer.