This week the Housing Bill has continued in its long worn out path through the Lords. The Liberal Democrats have been battling to make changes to a Bill which will currently only worsen the housing crisis, reducing the availability of housing and moving the first rung of the housing ladder even further out of reach.

Across the past fortnight, facing the threat of multiple humiliating defeats at the hands of opposing peers, the Government have been forced to back pedal on a number of measures. This week they made a significant concession on protections for tenants at the hands of rogue letting agents. An amendment with my name on it had been put forward which ensured that money belonging to tenants for use as holding fees, deposits, rent, or service charges by letting agents, was protected.

20% of the letting agent sector does not have protection for client money. The amendment we put down was targeted at protecting the fifth of the industry in which tenants and landlords remain at risk. People risk losing their money if a letting agent goes bust or if the money goes walkabout in a liquidation. Client money protection will be mandatory in Wales from November. All letting agents will be required to apply for a licence and part of the application process is showing that they have professional indemnity insurance and client money protection insurance and are a member of a redress scheme. If the Welsh can do it, I am glad to see that the English are following.

Perhaps the best way of illustrating why this change is needed is by telling horror stories, of which there are many. This month, it was reported that a company called Whitefield Properties took rental money due to landlords and tenants’ deposits over a four-year period. The money was paid into the firm’s bank account and was, perhaps carelessly, not protected. It was reported that £123,000 of customers’ money went missing. The Staffordshire firm, with branches in Milton, Leek and Crewe, went into administration in 2014.

A lot of the letting agents who are currently not covered target vulnerable groups. As they are vulnerable, they do not satisfy credit checks, so they cannot give the guarantees that banks would often offer. Agents, often ask for something like a full year’s rent in advance because the person is not trusted. The person probably borrows the money to get that year’s rent in advance. History shows that a lot of these large sums of rent in advance go into the agent’s bank account, and even if it is in an account that may internally be called a client account, if it is not recognised as such by the bank, those moneys can, and often are, used by the agent for one purpose or another. Very often this is because the agent is overtrading, spending more money than it should and using their clients’ money.

It is clear that a law making client money protection insurance mandatory for all letting agents has been long overdue.

The change we have won from the Government is another small change to an extensive 200 page Bill, but is an important one. It is a distinctive Amendment in that the Government have accepted our amendment on Client Money Protection and it cannot be overturned in The Commons. Renters have gained more rights against unscrupulous letting agents looking to exploit their clients and the trust placed in them. This remains a harmful Bill which will only work to worsen the housing crisis, however, by making the Government think again on some issues, we have made a step in the right direction, towards greater protection for the vulnerable, greater accountability for those with power, and greater freedom for those seeking a home.

* Monroe Palmer (Lord Palmer of Childs Hill) is a Lib Dem peer who speaks on defence and international affairs