HC Deb 23 March 1959 vol 602 cc1021-33
The Joint Parliamentary Secretary to the Ministry of Transport and Civil Aviation (Mr. John Hay)

I beg to move, in page 46, line 36, at the end to insert: (c) is land indicated in a development plan (otherwise than by being allocated or defined as mentioned in the last preceding paragraph) as land on which a road is proposed to he constructed or land to be included in a road as proposed to be improved or altered, or. I think it would be for the convenience of the Committee, Sir Gordon, if we could take with this Amendment seven subsequent Amendments to the Clause in the name of my right hon. Friend the Minister of Housing and Local Government. I think that, in that way, we may be able to make a little progress in clearing the Order Paper.

The Deputy Chairman (Sir Gordon Touche)

Yes, I think that would be for the convenience of the Committee.

Mr. Hay

As the Committee will remember, the purpose of the Clause is to enable the resident owner-occupier of a house or part of a building which is used as a dwelling to require certain authorities to purchase his interest where that interest is clearly shown to be subject to some threat of future compulsory acquisition. This is what we call planning blight which makes property unsaleable. Subsection (7) defines what is meant by "authority" It is a local authority, a Government Department or some other body possessing compulsory purchase powers.

The Clause gives the owner the right, where blight has occurred, to serve a notice on an authority requiring it to purchase the property now and not at some future time. The owner can do this only if he can show that he has made a reasonable effort to sell the property, but has been unable to sell except at a substantially low price than the property would otherwise have fetched had the blight plans, if I may use the expression, not existed.

Circumstances which cause blight are set out in paragraphs (a) to (d) of subsection (1), and during the Committee stage my hon. Friend the Member for Crosby (Mr. Page) drew attention to one particular defect, namely, that the provisions as they stand are not wide enough to cover all cases of road construction, alteration or improvement. My hon. Friend the Joint Parliamentary Secretary to the Ministry of Transport and Civil Aviation gave an undertaking that we would look into this point, and the Amendments are the result.

The effect is to include two new paragraphs in subsection (1). By the first Amendment, there will be a new paragraph (c) which covers specifically road proposals which are shown in a development plan. By the second Amendment, there will be a new paragraph (e) which will cover the case where a local authority approves by resolution plans for constructing, improving or altering roads—that is, speaking in fairly broad terms, principally the minor type of road improvement or construction work.

If the Committee approves the Amendment, the consequence will be that in the context of Clause 32 we shall cover three types of case. The first is where roads are shown in the development plan as being constructed, improved or altered. The second case, which is already covered by paragraph (d) of subsection (1), will be trunk and special road schemes such as motorways, or orders made by the Minister of Transport and Civil Aviation or special road authority. The third type will be, as I have said, the more minor type of road works, plans for which are approved by the local authority.

The other six Amendments, I assure the Committee, are either drafting or consequential, and I need not take up time with them. However, I should like to express my appreciation to my hon. Friend the Member for Crosby for drawing attention to this point. I hope that the Amendments are acceptable to him and to the Committee.

Mr. MacColl

It seems to us that this is a reasonable extension of the principle which has already been accepted in Committee, and we therefore do not oppose the Amendments.

Mr. Page

I rise only to thank my hon. Friend the Joint Parliamentary Secretary most sincerely for carrying out the undertaking given during the Committee stage and particularly for working out the consequential Amendments, which I had not done originally.

Amendtnent agreed to.

Further Amendment made: In page 47, line 4, at end insert: or (e) is land shown on plans approved by a resolution of a local highway authority as land comprised in the site of a road as proposed to be constructed, improved or altered by that authority".—[Mr. Hay.]

Sir Eric Errington (Aldershot)

I beg to move, in page 47, line 9, to leave out "a resident" and to insert "an".

It might be convenient for the Committee to discuss at the same time the following four Amendments: In page 47, line 23, leave out "a resident" and insert "an"; in line 33, leave out "resident"; in page 48, line 3, leave out "resident"; and in line 5, leave out "as a private dwelling". I would further suggest that we discuss with these Amendments the Amendment in the name of my hon. Friends and myself which was put down for consideration on Report, in page 48, line 21, at end insert: (7) The provisions of this section shall not apply to a limited liability company unless the management thereof is in the hands of a person or persons who together, if more than one, are beneficially entitled to a minimum of two-thirds of the paid up share capital of such company. 9.30 p.m.

The expression in the Clause, "resident owner-occupier" is one which, I think, is a new expression, and while it covers a substantial number of cases it does not cover some cases which may suffer from planning blight. For that reason, to leave out the word "resident" would widen the Clause very considerably.

The way in which the case is dealt with is not upon the basis of hardship but upon the basis of unsaleability of the land affected. In these circumstances it would seem only fair that not only the resident in residential premises should be protected from planning blight but also the individual who has a small lock-up shop. One knows of many cases where people have received compensation for injury, and the case of people who find themselves in a position in which they cannot get customers to their shops, and see their trade being lost day after day, is in many ways just as great a one of hardship as is that of a residential occupier.

It was felt, however, that this might, and indeed would, open the door rather wider than was considered wise, and for that reason the last Amendment to which I have referred, in page 48, line 21, was put down. The object of that provision is that a large company with a number of branches should not be able to take advantage of the extension proposed in the other Amendments. The larger company has facilities for transferring trade to branches, facilities which are not open to the ordinary individual who runs a lock-up shop.

I would not say that these Amendments are necessarily word perfect, but their object is to cover the case not only of the ordinary resident owner but of what I would describe as the working proprietor of a business. My right hon. Friend may be able to find some happier words which would extend, though not too far, the terms of the subsection.

Mr. Page

I support the Amendment. I understand that the Clause is intended to remedy the injury done to a person whose property is reduced in value by planning proposals hanging over his head like the sword of Damocles when he does not know when it will drop and, for that reason, he is unable to dispose of his property at its proper value.

The whole background of the Clause is hardship, although "hardship" is not mentioned at all in it. It is a question whether it will be a hardship on a resident owner-occupier if he is unable to dispose of his property at its proper value because of the planning proposals which are upon it. But because of the difficulty of defining hardship for the purposes of a statute, the test put in the Clause is unsaleability. Having got to that test of unsaleability, if we applied it to all those who would suffer hardship, whether resident owner-occupiers or occupiers of business premises or those who merely invest in property, we should have the difficulty of commercial property possibly being unloaded on to the local authority at a time convenient to the owner of that property.

Therefore, I understand that in the process of reasoning in drafting the subsection the unsaleability test was restricted to the resident owner-occupier. But the result is that it thus excludes some of those who will suffer a very real hardship by planning blight, particularly the small business man. I think that he will suffer a greater hardship in some cases than the resident owner-occupier.

If the resident owner-occupier retains his property until notice to treat is served, perhaps five or ten years hence, he will get the value of his house. It is true that he will suffer hardships if he wants to dispose of it before notice to treat is served on him, but if he hangs on he will have the market value under the present Bill. That may not happen to the small shopkeeper. He will see his business dwindle away because he is in an area eventually scheduled for compulsory purchase and from which the residents are already moving to a new estate.

Compulsory purchase orders may be coming on that area step by step, and his customers may already be moving away from him. Therefore, unlike the resident owner-occupier, he may be losing the value of his property, and, if he hangs on, the property may be of less value when it is eventually compulsorily purchased from him. Therefore, he may suffer even a greater hardship than the resident owner-occupier. It has been difficult to draft an Amendment which would confine its provisions to the small man without letting in commercial undertakings which can fend for themselves. An effort has been made to restrict application of the Amendment to companies where there is a working owner. I would hope that the Amendment would do what we intend it to do. The intention is that the hardship which will fall on the small business man through planning blight should be taken into account in the Clause.

Mr. Gibson

The Amendment widens very considerably the range of cases which could be affected by the Bill. The position of the resident owner-occupier is mentioned in the Bill. Some of us had doubts during the Committee stage whether it was covered not where a compulsory order had been applied but where it was suggested that one might come into operation in five, ten or fifteen years' time. As I understand the Amendments which have been made, that point is now covered.

That is no reason why we should extend the range as this Amendment will do. In spite of what has been said, I am not at all sure that the Amendment will not let in property companies, and I am not particularly anxious to do that. I hope the Minister will take that view.

With regard to shops, surely once a compulsory order is approved by the council and put into operation, shopkeepers are covered by the ordinary procedure and, as has happened many times, are given the necessary compensation and frequently, at any rate in London, provided with a new and much better shop in a much better situation where they can continue to make profits. There is not the same loss to them as there is to the poor devil who has bought a house and then finds that a road will go through his front garden and wants to get rid of the house but is unable to do so. I hope the Minister will not accept the Amendment.

Mr. Brooke

I agree with the hon. Member for Clapham (Mr. Gibson) that this group of Amendments goes too wide, but there is a problem here and I think both sides of the Committee would agree upon that. What the Government have been seeking to do—I explained this in Committee and said that no Clause in the Bill had been more carefully considered before the Bill was introduced—is to give an effective safeguard against the hardship which planning blight can impose on those for whom there is, as it were, no escape from it.

In the Bill as drafted we confine this to the resident owner-occupier, partly because we found by experience that more than 90 per cent. of all the cases reported to the Department concerned the resident owner-occupier, and partly because it is the resident owner-occupier who will not he moving home unless he really is under strong compulsion to do so. Thus, there is no question of his choosing a time to unload on to the local authority.

At the same time, I said on Second Reading, and perhaps I may be forgiven for repeating it now, that the background is changing. I said: Outside the statutory provisions local authorities and public authorities generally will have discretion to purchase in advance other types of property besides the residential owner-occupied property. Hitherto the bias of Government policy has been against their doing that. Loan sanction has been grudgingly given, and Exchequer grants have not been available until the actual development took place. Now, by Clauses 35 and 36, and a promise of a change in administrative policy, all that is being reversed, and the Government will in future be encouraging local authorities to meet cases of hardship by purchasing in advance."—[OFFICIAL, REPORT. 13th November, 1958; Vol. 595, c. 693.] 9.45 p.m.

This is a genuine change in Government policy, and it will mean that local authorities will, in the exercise of their discretion, be much more disposed to purchase in advance when hardship is brought to their notice than they have been in the past. Nevertheless, the Government felt that it was right to give to the resident owner-occupier the power of demanding that if he could prove blight, or if he could prove diminution of value, the public authority would purchase the property from him.

My hon. Friend the Member for Aldershot (Sir E. Errington) suggested that there were others who should be considered in addition to the resident owner-occupier and that there might be cases to rival that of the resident owner-occupier in a need for certainty that it will be possible to get the local authority to purchase in advance where there is genuine blight. As I said at the beginning. this series of Amendments would extend beyond those cases of individual hardship which the hon. Member has in mind.

The test that has to be applied here is the test in the case of a limited liability company, that the management is in the hands of persons who are beneficially entitled to at least two-thirds of the paid-up share capital. That might bring in some very substantial businesses. Indeed, from the wording that my hon. Friend used in moving the Amendment, I sensed that he was conscious of that and that this had been as it were a shot to try and find a definition that would really be confined to the working proprietor. I hope he will not take it amiss if I say that it was a rather bad shot—

Sir E. Errington

Perhaps my right hon. Friend can make a better shot.

Mr. Brooke

—but I can appreciate what he is aiming at. The argument of my hon. Friend is that the working proprietor who gets his living through a small lock-up shop may be in as difficult a position as the resident owner-occupier who may live over the shop or the resident owner-occupier who is occupying a house and for very good reason needs to move.

Both sides of the Committee would accept that an owner-occupier would not move unless he had to. To get out of one house into another is not a thing one does lightly. There is no question of unloading on the public authority.

I said in Committee that if the Government could see some new form of definition which did not place upon the Minister or anybody else the task of defining severe hardship I would be sympathetically disposed to it, and I repeat now that if any hon. Member on either side of the Committee can suggest a test which would include individual working proprietors as well as the resident owner-occupiers whom we all probably wish to help, I should be sympathetically disposed to it.

I can give my hon. Friend the undertaking that the Government will examine this further. The Bill will have to pass through all its stages in another place and if somebody between now and then can suggest a test that will genuinely safeguard the position of the small man, without opening the door to the large concern being enabled to unload its property at a time of its own choosing on to the local authority, the Government will sympathetically consider that.

Sir C. Thornton-Kemsley

Although my right hon. Friend has spoken, I make no apology for bringing forward another example of hardship which has not been mentioned. That is the case of the owner-occupier of farm land. The owner-occupier of a farm is in a particularly difficult position, because under the definition Clause, the hereditament is the aggregate of the land forming the subject of a single entry in the valuation list.

As hon. Members know, agricultural land is not included with the house and garden, so that the separate entry in the case of a farm is that of the farmhouse and garden. That means that if the whole of a farm is designated on the plan for acquisition, the owner-occupier can compel the acquiring authority to acquire only the house and the garden. It is difficult to see what special value could be placed on the house and garden which would represent the value of the farmhouse as an integral part of the farm holding.

The purpose of the Clause is to enable the resident owner-occupier to rehouse himself, if he requires to do so, and in certain conditions to compel the acquiring authority to buy his land in advance of requirements, to enable him to buy another property. As an example, if the farm is designated for use as a reservoir it would he impossible for the owner-occupier, even if he could compel the acquiring authority to acquire his house and garden, to get enough money to buy another farm, and while the threat of acquisition was over him, he would not be able to raise money on the land, which would have become unsaleable.

If a substantial part of the farm is designated for some public purpose, but the area designated does not include the farmhouse the Clause would not apply, even though the farm were rendered practically unsaleable as a result of the designation.

I have had brought to my notice the case of a small fruit farm of about 30 acres which was designated as long ago as 1949, under the first plan soon after the Silkin Act came itno operation. There is no point in the owner replanting his trees, as he should do in accordance with the rules of good husbandry. Nor is there any point in bringing the buildings up to modern requirements and re-equiping the holding, and so on. To do so would only add to the burden of the price which the acquiring authority would have to pay at the end of the day.

Yet the farm is going down as the trees get older and need replacement. The farmer wants to get out of the holding and to acquire another, but he cannot sell and thus cannot buy another holding. Nor can he re-equip the present holding, and that seems to be against both private and public interest.

In Committee my right hon. Friend explained that if farm buildings and farm land were not excluded from these arrangements acquiring authorities might find themselves obliged to buy very large farms—I believe an instance was given of a farm of over 1.000 acres—just because a small area of the farm was required for public purposes. It was said that this would impose an intolerable burden upon the acquiring authority. Of course it would, in those circumstances, but there is no intention of excluding farms or any other form of property from the obligation to show that every effort has been made by the owner to sell the farm, or whatever the holding may be, but that he has not been able to do so except at a price substantially lower than might have reasonably been expected.

That would clearly not apply to a very large farm of which only a small area was required, perhaps for a cemetery or a similar purpose. The owner would not be left with something which was unsaleable; he would be left with the rest of the farm, and farms are in great demand nowadays. If only a small area were required there would be no difficulty about his selling the remainder, and he could not possibly qualify under the terms of the Clause.

I am sorry that I have spoken after the Minister, but it is right that these matters should be deployed. Arrangements on the lines suggested by my hon. Friend and I have the support of such bodies as the Royal Institution of Chartered Surveyors, which points out that the Clause, as drafted, does not apply to occupiers of properties used for business or agriculture, and urges that the Clause should be extended to cover such cases, since, as it points out, equal hardship may be occasioned. It also has the support of the Incorporated Society of Auctioneers and Landed Property Agents, which urges that the owner-occupiers of any land designated for compulsory acquisition should be able to require the designating authority to buy his interest or release the land from designation. That is further than some of us would go, but it is supported in principle by other bodies, to mention only a few, by the National Farmers' Union, the National Federation of Property Owners and the Retail Distributors' Association.

My right hon. Friend, perhaps a little unjustly, chided us for not having brought forward a workable Amendment. As a result of what he then said we have tried to frame an Amendment which would help the farmer or small business man, and although my right hon. Friend does not like the way in which we have done it, I hope that he will not shut his mind to the possibility, or prevent his Departmental officials, between now and the concluding stages of the Bill, from trying to deal with these difficult cases.

Mr. Brooke

My hon. Friend may like me to reply immediately. The kind of case which he has mentioned is the kind to which a solution should be found, and if he will let me have further particulars I will most gladly look into the matter. I shall see whether the local authority concerned is willing to purchase in advance. It seems unreasonable that a long-standing blight should fall upon a farm of that character, and I would hope that, either by statutory provision or by the local authority exercising its discretion, the blight could be lifted.

I am sure that my hon. Friend will appreciate that there may be a difference between the kind of case which my hon. Friend the Member for Aldershot (Sir E. Errington) seemed to have in mind—the case of the lock-up shop—and the kind of case where a road is likely to cut off one corner of a very large farm. It may be damaging to the farm, and the farmer would certainly deserve compensation for that; but it would not necessarily prevent his continuing to operate the farm as an economic unit. I think there is a clear distinction between the large farm which is only slightly affected by proposed public development, and the small lock-up shop where the man may suffer very serious financial hardship if he can do nothing about it.

10.0 p.m.

I should like to look into all this further, and, indeed, perhaps both sides of the Committee would desire that I should. If there is any practical Amendment, I would hope that the rules governing the procedure of the two Houses would permit it to be made with propriety in another place. I am not saying that we can find any better line of demarcation than is in the Bill at present, but I do say that I retain an open mind about it, and that if my hon. Friend the Member for Aldershot is willing to withdraw this Amendment, I will go on thinking and the Government will go on thinking; and I hope that all those concerned will be ready to make any further suggestions they may have.

Sir E. Errington

In view of what my right hon. Friend has undertaken, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Amendments made: In page 48, line 27, leave out from "allocated" to first "of" in line 29 and insert: defined or indicated as mentioned in any of paragraphs (a) to (c)

In line 32, leave out "or defined" and insert "defined or indicated".

In line 40, at end insert: (d) in relation to land falling within paragraph (e) of subsection (1) of this section, means the date of the passing of the resolution by virtue of which it falls within that paragraph.

In line 45, leave out "(d)" and insert (e)".

In line 45, leave out from "section" to "proposed" in line 1 on page 49 and insert: the land is liable to be acquired or is indicated as being".

In page 49, line 5, leave out "(d)" and insert "(e)".—[Mr. Hay.]

Clause, as amended, ordered to stand part of the Bill.