Commons Sitting of 24 October 1967

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
PRIVATE BUSINESS
  STANDING ORDERS (PRIVATE BUSINESS)
  Order read for resuming Adjourned Debate on Question [20th July], That the new Standing Order relating to Private Business hereinafter stated in the Schedule be made:

SCHEDULE
95A. Where any society, association or other body, whose main objects include the protection of amenity or the conservation or study of features of natural, historic or archæological interest, petition against a bill, alleging that the amenity or such features of any locality will be adversely affected to a material extent by the provisions contained in the bill, it shall be competent to the Court of Referees, if they think fit, to admit the Petitioners to be heard on such allegations against the bill or any part thereof:
Question again proposed.
Objection being taken to further Proceeding, the debate stood adjourned.

ORAL ANSWERS TO QUESTIONS
  COMMONWEALTH AFFAIRS

    Rhodesia
    Mr. Wingfield Digbyasked the Secretary of State for Commonwealth Affairs what authority he now recognises as having control of Rhodesian Railways, now the Rhodesian section is split from the Zambian.
    The Minister of State for Commonwealth Affairs (Mr. George Thomas): The Rhodesia Railways, set up in 1963 as a body corporate for Southern Rhodesia and Northern Rhodesia—now Zambia—jointly, has not been dissolved. While the Zambian and Southern Rhodesian sections of the Rhodesia Railways have been operated as two distinct sections since 30th June this year, the assets and liabilities of the Railways remain vested in the original body corporate, which is still jointly owned by the lawful Government of Southern Rhodesia and the Government of Zambia.
    Mr. Digby: Is not this something that ought to be talked about, if only from the point of view of pensioners? May I express the hope that the Secretary of State will prolong his stay to clear up these kind of points, as the pensions aspect is very important?
    Mr. Thomas: I know that the House will wish my right hon. Friend fair weather and godspeed in the journey which he will make today, but I can give no assurance on the other part of the question.
    Mr. Paget: From that reply, does my right hon. Friend say that the Government of Great Britain, which is the lawful Government of Rhodesia, are responsible for these pensions and debts and will pay them?
    Mr. Thomas: I said that we are responsible.
    Mr. Wallasked the Secretary of State for Commonwealth Affairs if he will make a statement on the effect of the sanctions campaign against Rhodesia and on the constitutional position in that country.
    Mr. George Thomas: On the basis of the réegime's own figures for 1966, the effect of "voluntary" sanctions was to reduce Rhodesian exports from £164·7 million in 1965 to £104·7 million in 1966 and imports from £119·8 million in 1965 to £84·2 million in 1966.
    No trade figures have been published by the illegal régime for the period since the mandatory sanctions were adopted on 16th December, 1966, but the United Nations' Secretary-General has stated that

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    on the basis of the trade statistics provided by U.N. member States there has been a significant decline in trade between Rhodesia and many of her trading parties in most of the commodities covered by mandatory sanctions during the first months of 1967.
    The constitutional position is that Southern Rhodesia remains a part of Her Majesty's Dominions.
    Mr. Wall: May I offer my congratulations to the Secretary of State on the assumption of his very important office? He carries with him the good will of this side of the House. Is the Minister of State aware that sanctions will not bring down the Smith Government and that a compromise could be reached on the basis of the "Tiger" constitution if the Government would only drop their insistence on their formula for a return to legality? Is it the Secretary of State's intention to try to seek a settlement by compromise when he visits Salisbury?
    Mr. Thomas: I presume that the first part of the hon. Gentleman's supplementary question proper was wishful thinking, when he said that sanctions would not succeed. There is no evidence yet. Mandatory sanctions have not been running for one year yet and it is much too early to reach a decision.
    Mr. Maclennan: Is my hon. Friend satisfied that, contrary to reports, the present embargo on exports from Rhodesia covers nickel exports and nickel products?
    Mr. Thomas: No, Sir.
    Mr. Frederic Harris: When will the Government come out of cloud-cuckoo-land and realise that sanctions are not realistically working? I advise the Minister to go to France and ask people there what is happening. It is nonsense. Is he forgetting entirely what the Prime Minister told the House in the early days about the effect of sanctions?
    Mr. Thomas: It is not for me to deny the authority of the hon. Gentleman on cloud-cuckoo-land: he might know more about it than me. Sanctions are having a very serious effect on the external trade of Rhodesia, and we take no joy in that. We want a settlement on honourable terms.
    Mr. Park: Will my hon. Friend reaffirm that the Government's policy of not granting independence to Rhodesia before majority rule remains unchanged? In the meantime, will he assure the House that, where necessary, all effective steps will be taken to increase the efficiency of sanctions?
    Mr. Thomas: We are constantly looking at the question of the effectiveness of sanctions. There is a Question to my right hon. Friend the Prime Minister today on the question of not granting independence before majority rule.
    Mr. Biggs-Davisonasked the Secretary of State for Commonwealth Affairs what representations have been made, or other action taken, regarding the use of Zambian and Tanzanian soil by terrorists invading Rhodesia.
    The Secretary of State for Commonwealth Affairs (Mr. George Thomson): The British Government's views on terrorism and unconstitutional action are well known to all Commonwealth countries. As the House will be aware, the British Government have recently reiterated their concern to the Zambian Government.
    Mr. Biggs-Davison: Do Her Majesty's Government accept full responsibility for the integrity of Rhodesian territory against agression from outside? If so, may we be assured that no taxpayers' money will pass from the United Kingdom to either of these two Governments while there is any question of terrorist invasions being launched from their territories?
    Mr. Thomson: I think the hon. Member is making a wrong approach to this very difficult problem. Rhodesia is in a state of rebellion against Her Majesty's Government, and I wish that we had had rather more support in the months gone by from the hon. Member in seeking to end the rebellion and restoring constitutional progress. It would not be sensible to deal with the matter in the way that the hon. Member suggests. The question of British aid to countries in Africa is of great importance in itself, and there is no reason to believe that stopping aid would have the results that the hon. Gentleman suggests.
    Mr. Crawshaw: Is my right hon. Friend aware that while most hon. Members regret the use of these forces which

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    are bringing suffering to women and children, the responsibility lies with the present Government in not imposing effective sanctions against Rhodesia, which has left the African people no other remedy than to take the matter into their own hands?
    Mr. Thomson: No, I cannot agree with that either. Her Majesty's Government have imposed sanctions in a way that has had much greater effect than has been generally accepted. If other countries in the international community were to do as well as we have done, greater progress would be made towards restoring peaceful and constitutional progress in Rhodesia.
    Mr. Maudling: In the light of the Government's attitude to terrorism, repeated this afternoon by the Secretary of State, can the right hon. Gentleman say what reply has been received to the representations made to these two Governments? Were the replies regarded as satisfactory, and, if not, what further action will the Government take?
    Mr. Thomson: We have received a reply from the Government of Zambia to our note, and that reply, as is customary in exchanges of this kind, remains confidential. I would not express myself as satisfied with the reply, and we are continuing to keep in close touch with the Zambian Government.
    17. Mr. Juddasked the Secretary of State for Commonwealth Affairs whether he will make a statement on recent evidence concerning trade between British firms and Rhodesia.
    Mr. George Thomas: Recent allegations by a spokesman of the illegal regime that trade between British firms and Rhodesia in the first seven months of this year amounted to £5·9 million are untrue.
    Since 2nd February, 1966, the export from Britain to Rhodesia of virtually all goods other than those for essential humanitarian purposes, and for the maintenance of the common services which Rhodesia shares with Zambia and Malawi, has been banned.
    The permitted exports in the period January to July, 1967, amounted only to £623,000.
    Mr. Judd: Does my right hon. Friend agree that effective means of enforcement are essential to a successful sanctions policy, and can he assure the House that there will be no hesitation on the part of the Government in bringing to justice any British business men involved in transactions of this kind?
    Mr. Thomas: I can give the House this very full assurance. Whenever hard evidence is obtained of United Kingdom citizens deliberately flouting the law, we shall take the strongest action.
    Mr. Bruce-Gardyne: Is the right hon. Gentleman aware that the Japanese Government are claiming 100 per cent. increase in their exports to Rhodesia this year and the Swiss a 50 per cent. increase in their imports? If British firms were allowed to follow this example, would there not be rather less unemployment and misery in Scotland and Wales this winter?
    Mr. Thomas: If the hon. Gentleman has any evidence of sanctions being deliberately flouted by citizens with whom we can deal, I promise that we shall take action. For the rest, he had better talk to the Secretary-General of the United Nations.
    Mr. David Steel: May I from this bench, albeit belatedly, offer congratulations to the Secretary of State on his appointment, saying how pleased we are that a Scot is once again in control of the Commonwealth, to which, I believe, the English have made an occasional contribution? Have the Government followed through the evidence given by the Sunday Times and the television programme "World in Action" about the breaking of sanctions?
    Mr. Thomas: My right hon. Friend is overwhelmed by the congratulations of a fellow Scot. As a Celt, I can assure the hon. Gentleman that the article in the Sunday Times, which was informative and useful, has been studied with care, as also has the programme "World in Action". The hon. Gentleman will not want me to go into details here.
    Mr. Bruce-Gardyneasked the Secretary of State for Commonwealth Affairs what study he has given to the extent to which officially recorded United

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    States imports from Rhodesia, amounting to $4·7 million during the first seven months of this year, included goods subject to United Nations embargo; and with what results.
    Mr. George Thomas: I have studied these statistics with interest, and I am satisfied with the explanation given by the United States Government that goods subject to United Nations embargo such as tobacco and chrome which appear in the statistics were exported from Rhodesia before 16th December, 1966.
    Mr. Bruce-Gardyne: How much longer does the right hon. Gentleman think that this curious trade will continue in conformity with the embargo? In view of his statement, will the right hon. Gentleman seek to persuade the United States Government to set aside the proceeds of this trade to help to offset the dollar cost of additional tobacco imports from dollar sources into this country?
    Mr. Thomas: That is another question. I thought that the hon. Gentleman would be pleased at the agreement between the United States and ourselves.
    22. Mr. Bruce-Gardyneasked the Secretary of State for Commonwealth Affairs what study he has given to the extent to which the 31 per cent. increase in exports from the Organisation for Economic Co-operation and Development member countries to Angola during the first five months of this year included goods destined for Rhodesia; and with what results.
    Mr. George Thomas: I have studied these figures with interest but have no evidence that this increase is attributable to the use of this route for goods destined for Rhodesia. Figures for imports into Zambia through Angola recently given by the Zambian Minister of Transport, Power and Communications show that, in the six months prior to I.D.I., Zambian imports through Angola amounted to only 9,253 tons, whereas in the first five months of the present year 83,154 tons were imported by this route.
    Mr. Bruce-Gardyne: Will the right hon. Gentleman consider advising British firms which have lost valuable export markets to overseas competitors to use the Angola-Zambia route into Rhodesia in the future?
    Mr. Thomas: I do not believe, and the Government do not believe, that goods are going through Angola and Zambia to Rhodesia. Zambia has re-routed her imports, and that accounts for the increase in trade.
    Mr. Whitaker: As everyone knows that sanctions are being breached through the port of Lourenço Marques, will Her Majesty's Government quarantine this port with the same naval vessels as are quarantining Beira?
    Mr. Thomas: That is a fair question, but I am in no position to give a full reply to my hon. Friend.
    Mr. Bellenger: Having recently returned from those parts of Africa, I welcome my right hon. Friend's statement, which is factual, but does he understand that the House looks to the visit of his right hon. Friend to get a settlement of this problem, as, undoubtedly, sanctions are, one way or another, being broken by members of the United Nations?
    Mr. Thomas: I believe that the House and the country look to my right hon. Friend to obtain a settlement on honourable terms if possible, but he is in honour bound by the conditions which both sides of the House have accepted in the past.

    Malta
    Mr. Wingfield Digbyasked the Secretary of State for Commonwealth Affairs what reappraisal he has made of the economic position of Malta, in view of events in the Middle East; and whether he will make a statement.
    Sir W. Teelingasked the Secretary of State for Commonwealth Affairs what plans are being made to help the Maltese economy, especially the docks; how far such plans have proceeded; and whether he will consider negotiating a treaty with Malta on the lines of the Anglo-Irish Trade Agreement.
    Mr. George Thomson: The Report of the Joint Mission for Malta provides a valuable guide to the solution of Malta's economic problems. We have accepted in principle the findings of this Report and are already taking action on those recommendations which concern the British Government. I had useful talks with Dr. Borg Olivier, the

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    Prime Minister of Malta, in London last week. The British and Malta Governments have agreed on the setting up of a Joint Steering Committe to follow closely and report on the implementation of the recommendations of the Joint Mission Report. I am glad to say that Lord Robens has accepted appointment as Chairman and that Professor Ross and Mr. C. M. Woodhouse have agreed to serve on it.
    As regards short-term action to meet the situation created in Malta by the Middle East war I would refer the hon. Member to my predecessor's reply to a Question from the hon. Member for Harrow, West (Mr. John Page) on 17th July, 1967. We have no present intention of negotiating a treaty with Malta on the lines of the Anglo-Irish Free Trade Agreement.
    Mr. Digby: May I congratulate the right hon. Gentleman and wish him a very useful time in his high office? I am very glad to hear about the implementation of the Malta Report, but will he not clearly recognise that the situation in the Middle East has deteriorated yet further, that for about 5,000 people in the dockyard there is very little work, and will he give urgent attention to the special problem of Malta, continuing as long as the Suez Canal is closed?
    Mr. Thomson: I am very grateful to the hon. Member for his personal good wishes. I can assure him that I am giving very urgent attention to this matter. For our part we, the British Government, have made recommendations to the Malta Government on a number of matters and we are now awaiting their views. We are ready to act as soon as we can get joint agreement to move forward.
    Sir W. Teeling: May I also offer best wishes to the right hon. Gentleman on his tour? He hardly mentioned the docks in his Answer. I therefore ask what is happening about Bailey's? Are we to go on indefinitely having this matter sub judice? It is a vital issue to the prosperity and future of Malta.
    Mr. Thomson: I have had talks with the Prime Minister about this very important aspect of Malta's problems but I am afraid that the present position is still that negotiations between Her Majesty's Government and Bailey (Malta)
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    Limited are in being and I cannot comment on the legal position.
    Sir Knox Cunningham: While wishing well to Malta, may I ask the right hon. Gentleman to make certain that any future treaty entered into will be a better bargain for the United Kingdom than the Anglo-Eire Agreement?
    Mr. Thomson: We are anxious to do the right thing by Malta, to which we have old obligations.

    Gibraltar
    Mr. Wallasked the Secretary of State for Commonwealth Affairs if he will make a statement on the constitutional future of Gibraltar.
    Sir W. Teelingasked the Secretary of State for Commonwealth Affairs when he proposes to call a conference to discuss the future of Gibraltar; and whom he proposes to invite.
    Mr. George Jegerasked the Secretary of State for Commonwealth Affairs whether he will make a statement on the future constitutional position of Gibraltar in view of the recent referendum.
    Mr. George Thomson: Mr. Speaker, may I at the outset express my gratitude to the hon. Member for Haltemprice (Mr. Wall) for the good wishes he expressed earlier? I require all the good wishes I can get in what I am about to undertake.
    In view of the result of the referendum on 10th September we will, as already announced, discuss with representatives of the people of Gibraltar appropriate constitutional changes which may be desired. I am in consultation with the Governor about procedure for setting these discussions in train. I expect that they will take place early in the new year.
    Mr. Wall: I welcome the Secretary of State's statement. What will be the scope of these constitutional talks? Will they lead to a final constitutional future for the people of Gibraltar?
    Mr. Thomson: I do not think that one ever says "never" in these matters. We hope that there will be useful constitutional discussions. The last constitutional changes in Gibraltar took place only three years ago. The main change that we ourselves hope will be discussed is a

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    simplification of Gibraltar's elected institutions by some form of merger between the Legislative Council and the City Council.
    Sir W. Teeling: I fully appreciate what the right hon. Gentleman says, but he does not tell us whom he proposes to invite. For instance, will the Indian community be invited, because I think that it ought to be? Why do not we have some form of round-table conference, a concept which I understand that the Secretary of State rejected yesterday, since we did this for Malta?
    Mr. Thomson: I should like to look further at the question of the Indian community being invited. The Malta Round-Table Conference was a special conference held to meet exceptional circumstances. I do not think that such a round-table conference would be appropriate in this case. What I have in mind in his case, though I have not finally decided about it, is probably a conference in Gibraltar itself, which I hope would be attended by a British Minister.
    Mr. Jeger: Does my righ hon. Friend appreciate that Gibraltar occupies a special position as the most loyal Colony we have? Will he, therefore, accord it a special relationship between now and the conference which he is calling? Does he intend visiting Gibraltar shortly?
    Mr. Thomson: I would not like to draw degrees of loyalty between various of Her Majesty's territories, but we were all deeply moved in this country by the expression of affection for this country of which the result of the referendum was an example. I am proposing that these discussions should be held very early in the new year, which is not very far ahead. My hon. Friend may be assured that between now and the constitutional discussions there will be a very intimate contact between Gibraltar and ourselves.

    Malaysia
    Sir G. Sinclairasked the Secretary of State for Commonwealth Affairs what discussions he has had with the Prime Minister of Malaysia during his recent visit here with regard to proposals to help Malaysia in its plans for economic development.
    The Under-Secretary of State for Commonwealth Affairs (Mr. William Whitlock): The previous Commonwealth Secretary's discussions with the Tunku were concerned with the rundown of our defence forces in Malaysia. In this context he referred briefly to the financial aid which we shall give the Malaysian Government to help them adjust their economy to the new situation.
    Sir G. Sinclair: Have the Government taken the opportunity to start talks with the Government of Malaysia about the economic aid that should compensate for what I regard as the premature withdrawal and reduction of British troops? Will the Secretary of State take particular care to ensure that British overseas private investment is still encouraged rather than discouraged in Malaysia?
    Mr. Whitlock: There have been discussions recently in Malaysia on this subject, but these have been conducted through the Ministry of Overseas Development and Questions about this matter should therefore be addressed to my right hon. Friend the Minister of Overseas Development.
    Sir G. Sinclairasked the Secretary of State for Commonwealth Affairs what discussions he has had with the Prime Minister of Malaysia during his recent visit with regard to the future rôle of British forces in Malaysia vis-à-vis Indonesia.
    Mr. George Thomson: I do not think it is helpful to speak in terms of the role of British forces against a friendly country. It was, however, made plain in the Supplementary Statement on Defence Policy following the talks with the Tunku last July that we shall honour our obligations under the Anglo-Malaysian Defence Agreement and consult on the way in which we should plan to meet them.
    Sir G. Sinclair: Does not the Secretary of State recognise that Britain's greatest successes in this area since the war were achieved by forces stationed on the ground in Malaysia and working with the Malaysian forces and with the people of Malaysia? Does he not recognise that to have forces that can be flown in or sent in on carriers at short notice is no substitute for having those forces on the spot in Malaysia?
    Mr. Thomson: No, Sir; I do not agree with the hon. Gentleman. The Tunku has expressed himself as satisfied with the proposed deployment. It is proposed that by the early 1970s British forces there will consist largely of naval forces, including an amphibious element, and air forces. These highly specialised and technical forces will sensibly complement the Malaysians' own ground troops, which they can operate far more economically than we can and which they are expanding.
    Mr. Stratton Mills: For how long is it intended to maintain air support in Eastern Malaysia?
    Mr. Thomson: That question should be directed to my right hon. Friend the Secretary of State for Defence.

    Scotland (Emigration Officials)
    Mr. G. Campbellasked the Secretary of State for Commonwealth Affairs what assistance is provided in Scotland by Her Majesty's Government to emigration officials from Commonwealth countries.
    Mr. Whitlock: None, Sir. The migration offices set up in Edinburgh and Glasgow by the Canadian and Australian Governments are operated by officials of the respective governmental migration services without any assistance from Her Majesty's Government.
    Mr. Campbell: Is the Minister aware that this assistance is not necessary because unfortunately the policies of the present Government and the ineffectiveness of the Secretary of State for Scotland are causing a substantial increase in emigration from Scotland?
    Mr. Whitlock: The longstanding belief of successive British Governments has been that the flow of British migrants to other parts of the Commonwealth has been of value to all concerned, and a source of strength and unity to the Commonwealth as a whole. I would have thought the hon. Gentleman would have been proud of the contribution that his fellow countrymen are making to the Commonwealth.

    Nigerian Students (United Kingdom)
    Mr. Barnesasked the Secretary of State for Commonwealth Affairs how many Nigerian students in the United Kingdom have been reported to his Department as being placed in financial difficulties as a result of events in Nigeria; and what arrangements he has been able to make to enable them to continue their studies.
    Mr. George Thomas: Up to 9th October, 29 applications for financial assistance had been received by the area offices of the Supplementary Benefits Commission, Ministry of Social Security, from Nigerian students who are in financial difficulties. About a dozen similar cases have been brought to the attention of my Department and students are being advised that they can claim supplementary benefit on condition of registering for employment. Many of these students came here to study at their own expense and it is not possible for the British Government to provide funds for them to continue their studies. I am, however, in touch with the Nigerian High Commissioner about this problem.
    Mr. Barnes: Would my hon. Friend not agree that the way in which Mr. Charles Umeh, a Biafran, has been shunted about between the British Council and the Ministry of Social Security, with very little help being given, is most disappointing? Surely Commonwealth students in this country, at a time when their own country is torn by civil war, deserve more help than they seem to be getting at the moment?
    Mr. Thomas: I will look into the case which my hon. Friend has raised. On the second point, it must be borne in mind that there are limits to what the British taxpayer—[HON. MEMBERS: "Hear, hear."]—I do not want any cheers from the other side of the House. There are limits and, therefore, we must ensure that proper inquiries are made.
    Mr. Tilney: Would the Minister of State confirm that when on 20th July I asked him a similar question he said that there had been few requests. Even now there are only 29, which is a very small number. Will he see that his answer is well advertised? Also will he

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    confirm that at last the Federal Government have decided to pay the pensions of British civil servants, for the payment of whose pensions the Eastern Regional Government are responsible?
    Mr. Thomas: That latter point is another matter. However, I hope that publicity will be given to the figures that I have announced.
    Mr. Wilkins: Will my hon. Friend say whether there is not another difficulty arising in connection with this matter? Is it not true to say that some of these students who find themselves in this unfortunate position are willing to work during weekends in hospitals and such places in order to obtain some money but that there is some difficulty about work permits? Will my hon. Friend look into that point?
    Mr. Thomas: The question of work permits is not one for me, but I will look into the matter to see whether I can help.

    Mr. Simbule
    Mr. Biffenasked the Secretary of State for Commonwealth Affairs what representations have been made to the Zambian Government on the suitability of Mr. Simbule continuing as High Commissioner in London.
    Mr. Blakerasked the Secretary of State for Commonwealth Affairs what action the Government intend to take with regard to the continued public criticisms of Her Majesty's Government by Mr. Alinan Simbule, the High Commissioner for Zambia.
    Mr. George Thomson: I have nothing to add to my reply to the hon. and learned Member for Antrim, South (Sir Knox Cunningham) on 23rd October.
    Mr. Biffen: Is it not clear from that reply that 10 weeks have elapsed since Mr. Simbule again made derogatory remarks about the British Government in London and in Nairobi? Is not the Government's attitude not so much one of tolerance but of craven indulgence, and is it not time that Mr. Simbule was sent packing?
    Mr. Thomson: No, I do not think so. The fact is that Mr. Simbule has not been in London since the remarks to
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    which the hon. Member is referring were made, which is two and a half months ago, except when in transit to his present post in New York. I think it is better to leave this matter to be resolved through the normal diplomatic channels.
    Mr. Blaker: Is it not a fact that 10 weeks have elapsed since the Zambian Government were asked for an explanation of Mr. Simbule's latest remarks? How long do the Government propose to wait for a reply?
    Mr. Thomson: I think it is better to deal with this matter in the way in which it is being dealt with, through normal diplomatic channels.
    Sir C. Mott-Radclyffe: Can the Minister think of another previous example of any High Commissioner or ambassador accredited here or anywhere else who has been allowed to remain in his post after expressing the kind of view and using the kind of language that Mr. Simbule has used about the Government to which he is accredited?
    Mr. Thomson: I appreciate the feeling on this matter, which is not confined to one side of this House or to one party, but I remind the hon. Member that Mr. Simbule has not been in his post since he left on 12th August. I think it would be in the best interests of relations between Zambia and Britain, which are of great importance, that we should deal with this matter in the way in which I am suggesting.

    Nigeria
    Mr. Biffenasked the Secretary of State for Commonwealth Affairs what proposals he has to protect British personnel and investments in Nigeria, in view of the present dispute between Biafra and the Nigerian Federal authorities.
    Mrs. Joyce Butlerasked the Secretary of State for Commonwealth Affairs if he will make a statement about the situation between the Federal Government and Biafra in Nigeria as it affects British interests.
    Mr. George Thomson: We have had to advise United Kingdom nationals, for their own safety, to leave those parts of Nigeria which have been the scene of

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    fighting. Inevitably some British property has been at risk. We have kept in close touch with the Nigerian authorities in these matters.
    Mr. Biffen: Is it not clear that the vacillation of Her Majesty's Government has resulted in our having the worst of all worlds in that we are repudiated by the Biafrans and the Federal authorities? Can the right hon. Gentleman say that he is fully satisfied that the considerable British investments particularly in Biafra are not being put unnecessarily at risk?
    Mr. Thomson: The hon. Member is quite wrong in the assumption that he makes in the first part of that supplementary question. We have not had the worst of both worlds. We recognise the Federal military Government of Nigeria and we have operated on that basis. I have to tell the hon. Member that the reports that I have had from the Mid-West are that damage to British property there has not been extensive, but it is too early yet to make any statement about what is happening to British property in Eastern Nigeria.
    Mrs. Butler: As the safety of British nationals as well as the future of the country depend upon bringing the conflict to an end quickly, could my right hon. Friend say whether he has made any attempts to obtain mediation between the two sides, particularly from somebody who is trusted by the Biafrans who are dominated by their fear of a repetition of the massacre and reprisals last year?
    Mr. Thomson: There are other Questions on this subject and I shall, therefore, confine myself to saying that Her Majesty's Government have always been ready to do anything they can to help to end the war and start talks.
    Mr. Tilneyasked the Secretary of State for Commonwealth Affairs what help he has offered to Nigeria towards bringing the civil war there to an end.
    Mr. George Thomson: We are ready to consider any proposal which the Nigerians make for our help in promoting peace talks or in any other way. I have stated this publicly outside this House as well as in private exchanges with the Federal Government.
    Mr. Tilney: With so many friends of Britain on both sides of this insane civil war, which is bringing great carnage and loss to all in Nigeria and to great British interests there, will the Secretary of State back up any mediation on the part of Heads of African States and also offer troops to keep the ring should there be a referendum on the frontiers of some of the new 12 States?
    Mr. Thomson: As one among many in this country who is an old friend of Nigeria, I warmly endorse the first words uttered by the hon. Gentleman. I assure him that, if there were any suggestion of effective help which we could give, we should certainly respond to it. We have warmly welcomed the initiative of the O.A.U. I am sorry that this has been delayed, but I understand that it is now likely to take place in the early part of November.

    Pakistan
    Mr. Pavittasked the Secretary of State for Commonwealth Affairs (1) what economic consultations he is having with the Pakistan Government during its preparation of the third five-year plan in order that it can have a realistic appraisal of its trade with Great Britain over that period should Great Britain join the Common Market;
    (2) what reply has been sent to the High Commissioner for Pakistan to the aide-memoire he submitted on the effect of Great Britain's entry into the Common Market; and what is his estimate of the amount of compensation which would be required in accordance with the General Agreement on Tariffs and Trade principle concerning the discontinuance of preferences.
    Mr. Whitlock: Consultations have taken place with the Government of Pakistan about the British application for membership of the E.E.C., but they were of a confidential nature and I do not think it would be right to disclose what was said. As regards compensation for loss of preferences, I am advised that the General Agreement on Tariffs and Trade confers no rights in this respect.
    Mr. Pavitt: I welcome my hon. Friend to his post on the Front Bench. Is he

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    aware that if we join the Common Market, one-third of Pakistan's trade with us will go to the wall by 1970, and it will be no consolation if we give further technical assistance while at the same time destroying that country's economy? Further, is he aware that the only relief in tariffs given by the Common Market so far is on tea, which Pakistan does not export and which Europe does not drink?
    Mr. Whitlock: I am grateful to my hon. Friend for his first remarks. The Pakistan five-year plan to which he refers covers the period 1965–70, and it is most unlikely that British entry into the E.E.C. would have any significant effect on Pakistan's trade during that period. My hon. Friend will know that, in the previous negotiations, agreement was reached that, after British entry into the enlarged Community, the Community would declare its willingness to negotiate a comprehensive trade agreement with Pakistan. This is one of the provisional agreements which we hope it will be possible to revive.
    Mr. Clark HutchisonDoes not the Minister realise that we are not going into the Common Market?
    Mr. Whitlock: That is a personal expression of opinion.

    Hong Kong
    Mr. A. Royleasked the Secretary of State for Commonwealth Affairs if he will make a statement on the situation in Hong Kong.
    Mr. Coeasked the Secretary of State for Commonwealth Affairs if he will make a statement on Hong Kong in the light of Lord Shepherd's visit there.
    Mr. George Thomson: My noble Friend the Minister of State for Commonwealth Affairs arrived back earlier this afternoon from his visit to Hong Kong.
    I know the House will wish to record its admiration for the splendid behaviour of the people of Hong Kong who have refused to be intimated by acts of violence. Although these have been committed by a very small group of troublemakers, I regret to say that since the disturbances began nearly six months ago until the 11th October, they have resulted in 40 deaths and 617 people injured. The House will wish me to express our sympathy to those who have suffered personal losses.
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    The Hong Kong police have continued to carry out their onerous and dangerous duties with the most praiseworthy determination and restraint, and with the full support of the overwhelming majority of the population. Despite terrorism, border incidents and sporadic bomb outrages, the colony continues its normal, energetic life. Economically Hong Kong continues to prosper because of the determination, energy and industry of her people. Exports and tourists have increased by 16 per cent. and 12 per cent. over the corresponding figures for 1966.
    Mr. Royle: Is the Minister aware that the House welcomes his statement and shares his admiration for the staunch and restrained action which both the Hong Kong Government and the police force have taken in the Colony? What action are Her Majesty's Government taking to obtain the immediate release of those Hong Kong policemen, including a police inspector, who have been kidnapped and taken across the border into Red China? Can the Minister give a firm assurances that the Government will continue to give support both here and in the Colony to the actions of the Hong Kong Government during the weeks ahead?
    Mr. Thomson: I give the hon. Gentleman that assurance. We are in discussion at the moment with the Chinese People's Republic authorities about the senior police inspector and the other policemen who have been abducted. I did not mention that in my main statement, although it is very much in my mind, because the discussions are at a delicate stage and I think that in the best interests of getting those people back the less said at the moment the better.
    Mr. Coe: Is my right hon. Friend aware that his statement will give great satisfaction to the people of Hong Kong, both for the forthright assertion of British responsibility for the Colony and for correcting some unfortunate and untrue impressions given in the Press and by broadcasting in this country of a Colony whose whole life was disrupted by bomb-throwers? Is he also satisfied that the recent reforms which have been gained as a result of the Minister of State's visit can be followed up by further reforms over a wide field?
    Mr. Thomson: My noble Friend has just arrived back today. I have had a

    1491
    brief meeting with him, but he will make a full report and we shall seek to follow up his recommendations.
    Mr. Rankinasked the Secretary of State for Commonwealth Affairs if he will make a statement on the outcome of his talks with the Governor of Hong Kong during His Excellency's recent visit.
    Mr. George Thomson: My talks with the Governor covered a wide range of subjects since I was anxious to take advantage of his presence here to familiarise myself with the various Hong Kong problems. Some of these have since been pursued by my noble Friend the Minister of State for Commonwealth Affairs during his visit to the Colony from which he returns today.
    Mr. Rankin: Is my right hon. Friend aware that in its 1956 Annual Report Hong Kong was promised a new society? In view of the splendid tribute which he has just paid to the people of Hong Kong, is it not time that they had the chance of helping to create that new society by means of the franchise?
    Mr. Thomson: I think that in the economic sense the people of Hong Kong have been showing an example to the rest of the world by creating a new society for themselves, which is the best way to tackle the matter. My hon. Friend knows very well from his long and intimate connection with Hong Kong that it has already been stated in the House on several occasions that because of Hong Kong's special position constitutional development towards self-government is not possible, and I have nothing further to add to that.

    Brunei
    Mr. Peelasked the Secretary of State for Commonwealth Affairs whether, since the abdication of the last Sultan of Brunei, any changes are proposed in the treaty with that State.
    Mr. George Thomson: No such proposals have been made.

    PRICES AND INCOMES POLICY
    Mr. Martenasked the Prime Minister if he will convene a conference of trade union leaders and the appro-
    1492
    priate Ministers to discuss the future of the Government's incomes policy.
    The Prime Minister (Mr. Harold Wilson): The prices and incomes policy now in force has been worked out with the Trades Union Congress and the Confederation of British Industry, and the Government are remaining in close touch with both bodies. I see no need for a special conference.
    Mr. Marten: Could the Prime Minister, as overlord of an essentially Socialist economic policy, tell the House whether he actually has evidence that the Communist Party is plotting to make a winter of disruption in this country?
    The Prime Minister: Yes, Sir. My right hon. Friend the Minister of Labour made his statement last week with my full support, and he would not have said what he did without abundant evidence to justify it.
    Mr. Arthur Lewis: Has my right hon. Friend's attention been drawn to a number of companies which appear to be evading the Government's restrictions and severe restraint in that they are increasing by rather large amounts dividends which are already high? If I give him one illustration, of a 65 per cent. dividend being raised to 75 per cent., will he have it investigated?
    The Prime Minister: My right hon. Friend the Chancellor of the Exchequer is in close touch with this, but my hon. Friend will be aware that over the period about which we have been talking the number of reductions in profits and dividends has exceeded the number of increases.

    EUROPEAN ECONOMIC COMMUNITY
    Mr. Gwilym Robertsasked the Prime Minister what progress has been made in Great Britain's negotiations to join the European Economic Community; and if he will make a statement.
    Mr. Winnickasked the Prime Minister if he will now state the position with regard to the British application to join the European Economic Community.
    Sir Knox Cunninghamasked the Prime Minister what communications he

    1493
    has had with the President of France during the Recess on the subject of the entry of the United Kingdom into the European Economic Community; and what progress has been made with the United Kingdom's application.
    Mr. Eldon Griffithsasked the Prime Minister what progress has been made on negotiations for British entry to the Common Market.
    Mr. Hector Hughesasked the Prime Minister if he will make a statement on the progress of his recent European continental talks and communications directed to Great Britain's entry into the Common Market.
    The Prime Minister: Since I last reported to the House, the European Commission has prepared its Opinion on Britain's application, in accordance with the procedure laid down in the Treaty of Rome. This document, which concluded that negotiations should be opened, is now being discussed at the two-day meeting of the E.E.C. Council of Ministers at Luxembourg. When that meeting is over my right hon. Friend the Foreign Secretary will make a statement to the House. In advance of that statement, and in view of reports which have appeared about the first day's transactions in Luxembourg, I should perhaps make this clear. Our application is in and remains in. We shall not be deterred by day-to-day developments or possible disappointments. We reject some of the reported statements as ill-informed, and conclusions said to be drawn from them as unwarranted and inadmissible. We are prepared to let the facts talk. Therefore I repeat that we are ready to enter into negotiations now.
    Mr. Roberts: Will my right hon. Friend make it clear that our application is based upon strength and not weakness by setting a time limit of months for the consideration of our application, and, if nothing has happened by then, making it clear that we shall look elsewhere for economic and technological co-operation?
    The Prime Minister: I think that the very robust attitude of the large majority of the Six makes clear their attitude to our application. I do not feel that it would serve British national purposes best by fixing any time limit. I have
    1494
    said that our application is in and remains in. In one sense it might be said that time is on our side, but I do not believe that time is on the side of those in Europe and Britain who want to see a much stronger technologically-based Europe with greater power to influence world events.
    Mr. Winnick: Would not my right hon. Friend agree that our chances of gaining entry to the Common Market at this stage are very slim, and that it is humiliating for the country if we proceed with our application if there are such strong and unreasonable objections from some of the countries in the Community?
    The Prime Minister: I think that for objections to be strong and unreasonable and seen to be such does not in any sense involve any humiliation for this country. I have already said what I and the Government feel about certain statements reported as having been made yesterday.
    Sir Knox Cunningham: Now it is clear that our application will fail, what plan has the Prime Minister for Britain?
    The Prime Minister: The hon. and learned Member may possibly have drawn that conclusion from what has happened. I do not. I suggest to the hon. and learned Member that he awaits the statement which my right hon. Friend will make when we have had a full report of what happened in Luxembourg.
    Mr. Hughes: Does the Prime Minister feel that the present visit of a distinguished German statesman will help Britain's application to join the Common Market and, if so, in what way?
    The Prime Minister: The full support of the German Government for Britain's entry has never been in doubt. I have not yet seen any report of what has been said at Luxembourg today on behalf of the German Government, but I have no doubt at all that they will take every means open to them to secure a successful outcome to the initiative that we have taken.
    Sir Alec Douglas-Home: Will the right hon. Gentleman see whether his right hon. Friend can make his statement before foreign affairs are debated on the Queen's Speech?
    The Prime Minister: It is the intention that he should make a statement this week, but, as I have said, we must wait until we have a full report from Luxembourg. I think that it will probably be made on Thursday, but certainly before Prorogation.
    Mr. Thorpe: In view of the fact that the strongest reservations by the Commission, and at any rate by France, have been in regard to sterling, to its valuation and to its reserve rôle, and in view of the very helpful speech made by the Chancellor of the Exchequer at Rio, will the Government consider taking a fresh initiative with regard to the suggestion for a European reserve currency?
    The Prime Minister: No initiative is called for. These matters can be discussed in negotiations. What my right hon. Friend said in Rio and what he said in an interview in Le Monde is what he has said in the House when we have debated these matters and what my right hon. Friend the Foreign Secretary and I stated in Paris. Since the right hon. Gentleman has, I think, incorrectly, referred to the valuation of sterling, I would just make it clear that when my right hon. Friend and I were in Paris the French Prime Minister went to great lengths to make clear his confidence in the valuation of sterling.
    Mr. Shinwell: Why does my right hon. Friend speak about ill-informed statements? What are these ill-informed statements? When he speaks about facts which have not been disclosed, have we not been told over and over again that all the facts have been disclosed to the House? Will he now disclose the facts which hitherto have not been disclosed?
    The Prime Minister: The facts have been fully disclosed to the House because, so far as Britain's economic position is concerned, we have debated it very fully and it has been dealt with many times at Question Time. When I referred to the facts, I meant the situation that at least one speech made yesterday did not seem to be based on those facts despite the efforts of my right hon. Friend and me in Paris to make the facts known to our hosts.

    GOVERNMENT DEPARTMENTS
    Mr. Gwilym Robertsasked the Prime Minister what plans he has for changes in the number, scope, and organisation of Government Departments; and if he will make a statement.
    The Prime Minister: I keep this matter under review and will inform the House when I have any changes to propose.
    Mr. Roberts: Does not the Prime Minister agree that there are too many Government Departments? Is there not a need to regroup into a smaller number of major Departments, such as welfare, production and distribution, each with a senior Minister in the Cabinet?
    The Prime Minister: These matters have been debated as long as Governments have existed. I will, of course, bear my hon. Friend's proposals in mind. I cannot see, however, that the best interests of British industry and trade would be served if the Board of Trade were divided into two Departments, one for production and the other for distribution.
    Mr. Costain: Has the Prime Minister's attention been drawn to the answer to a Question yesterday by the Minister of Public Building and Works stating that 6 million additional feet of office accommodation have been taken by Government Departments since 1964? Is that not one of the reasons why the housing programme has fallen behind?
    The Prime Minister: No, Sir. In the first place, the housing programme is not behind. I have noticed that, with the record figure of housing starts and the number of houses under construction, far fewer Questions have been put to me about housing. The office space is required for policies approved by the House, including the improvements in our social security provisions and including the investment grants scheme, for example, needed to bring work to the development areas.

    RHODESIA
    Mr. Juddasked the Prime Minister whether, since the return of Lord Alport from Rhodesia, the Government are still committed to a solution of the Rhodesian

    1497
    problem on the basis of Nibmar and not on the basis of the six principles.
    The Prime Minister: There has been no change in our position on this matter since Lord Alport's return from Rhodesia.
    Mr. Judd: Does the Prime Minister agree that there can be no confidence in securing full rights for the people of Rhodesia as a whole short of Nibmar? Does he realise that he will have the maximum support, from this side of the House at least, in any action necessary to achieve that objective?
    The Prime Minister: I have nothing to add to what I have said on previous occasions about the declaration made by the Commonwealth Prime Ministers' Conference last year. But I must repeat, as I did last time we discussed these matters in the House—because a lie has been carefully fostered on the question in Rhodesia—that we have made it clear many, many times in the House and in Rhodesia that there can be no question of early majority rule. When one looks at the state of African national leadership in Rhodesia one finds that very much emphasised. How much that is the fault of the Europeans there is a matter for debate.
    Mr. Winnickasked the Prime Minister if he will make a statement on the latest position on Rhodesia.
    Sir Knox Cunninghamasked the Prime Minister if he will state what progress he has made with Mr. Ian Smith in reaching a settlement of the issue of independence for Rhodesia.
    Mr. Ashleyasked the Prime Minister if he will make a statement on the most recent discussions between the Government and the illegal regime in Rhodesia.
    Mr. Biggs-Davisonasked the Prime Minister whether he will make a statement about Her Majesty's Government's relations with Rhodesia.
    Mr. William Hamiltonasked the Prime Minister if he will make a further statement on the progress of the investigatory talks with the illegal régime in Rhodesia.
    Mr. Hooleyasked the Prime Minister if he will make a statement
    1498
    about the communications which have passed between the British Government and the illegal regime in Rhodesia during the Summer Adjournment.
    Mr. Whitakerasked the Prime Minister whether he will make a statement about ending the illegal régime in Rhodesia.
    Mr. Edward M. Taylorasked the Prime Minister if he will make a statement on the latest situation in Rhodesia.
    Mr. Sandysasked the Prime Minister whether he will make a statement about Rhodesia.
    The Prime Minister: As foreshadowed in my statement of 25th July, exchanges through the Governor have taken place during the Recess. I have, however, no information to give the House at the present time, though I am bound to say that the tenor of the exchanges so far has not been encouraging.
    The House will know that my right hon. Friend the Commonwealth Secretary will be leaving today to visit African Commonwealth countries to discuss matters of common interest with their leaders. As the House will also know, in the course of his journey my right hon. Friend will be visiting Rhodesia at the invitation of the Governor, and while in Salisbury he will be ready on the recommendation of the Governor and under the Governor's aegis to see other Rhodesians, including Mr. Smith.
    A full report will, of course, be made to the House after my right hon. Friend's return.
    Mr. Winnick: Will the Prime Minister make some comment on the operations of South African troops and armed forces in Rhodesia? Does the Prime Minister not agree that it would have been better and more honest if the Leader of the Opposition at Brighton had educated his own party delegates to the moral issues involved in this dispute?
    The Prime Minister: On the first point, Her Majesty's Government have issued a statement and I will see that it is made available in the Library and to my hon. Friend. On the second point, I very much applaud the fact that in that speech, which I have read, the Leader of the Opposition fully supported the need for

    1499
    a return to legality and constitutional law and once again, and I think very rightly, reiterated the six principles, which were, of course, the policy of the previous Government, as well as being the policy of this Government. I think that that was entirely helpful. The only criticism I make is that he went on fostering the misunderstanding, the misrepresentation, that the "Tiger" talks foundered on a demand by us for direct rule. There was no such demand, and Mr. Smith knew it.
    Mr. Speaker: Questions put to a Minister ought to be about a matter in which there is Ministerial responsibility.
    Sir Knox Cunningham: Would it not be wise to reach a settlement and to get rid of sanctions in weeks, not months?
    The Prime Minister: Yes, Sir. It was offered in days last December to Mr. Smith. On that occasion he could have gone off the ship as Prime Minister designate—legal, constitutional, Prime Minister designate—and the unwinding of sanctions would have begun immediately. Unfortunately, he or a majority of his Cabinet rejected that very fair and just offer which was made.
    Mr. Biggs-Davison: Since in Ghana the Constitutional Commission is giving serious consideration to a qualified franchise as more suitable to African conditions than one man, one vote, will the Prime Minister not be dogmatic about Nibmar but concentrate on trying to reach a just solution and press forward to the new legality described by my right hon. Friend the Leader of the Opposition at Brighton?
    The Prime Minister: The "Tiger" constitution involved a highly qualified franchise. It would have involved qualification for that franchise over a period of very many years before we came anywhere near one man, one vote. The best estimate made at that time was about ten to twelve years. I should not have thought that that was too long a period in the circumstances. What we cannot accept—and I do not think that the previous Government would accept it either—is deliberate action on the part of the European minority to hold back progress towards the achievement of the franchise. Our offer of a great educational pro-
    1500
    gramme, repeating the offer of the right hon. Gentleman opposite, was flatly rejected on the ground that it would have given too many Africans the vote.
    Mr. Hamilton: How long will my right hon. Friend the Secretary of State stay in Salisbury? Does my right hon. Friend the Prime Minister think that it is humanly possible to reach an agreement, based on the six principles, which would be satisfactory to this House and to our Commonwealth friends?
    The Prime Minister: My right hon. Friend plans at present to stay in Salisbury for two days, but of course, if necessary, he is prepared to stay longer. But he would require very much more evidence than has been forthcoming that there is willingness to talk about an honourable settlement in Salisbury. Certainly, no settlement would be reached by Her Majesty's Government that was not in any sense fully honourable and acceptable to this House.
    Mr. Hooley: Does my right hon. Friend agree that operations by foreign troops and police in Rhodesia create an entirely new situation? What steps are being taken to deal with this?
    The Prime Minister: I have already answered one Question on this subject today. South African police, not troops, were involved. We have rejected their right to intervene in British territory. When my right hon. Friend the Foreign Secretary and I met the South African Foreign Minister, he limited their claim to be there to dealing with known South African terrorists heading for South Africa. However, we regard the intervention of these police as wrong and have said so.
    Mr. Whitaker: What action has my right hon. Friend in view to concentrate Mr. Smith's mind by further action, such as, for example, quarantining the port of Lourenco Marques?
    The Prime Minister: We have looked at the question of making sanctions more effective, but we should not overlook the deep effect that they are already having on the Rhodesian economy. One of the biggest problems is the sheer evasion of the oil sanctions through Lourenco Marques, and I have no doubt that this will be one of the questions that my right

    1501
    hon. Friend the Secretary of State for Commonwealth Affairs will be discussing with Heads of Government during his visit.
    Mr. Edward M. Taylor: Is the Prime Minister aware that many people in Rhodesia and elsewhere find it difficult to understand our insistence on Nibmar when, in South Arabia, the Government are offering the cloak of legality to bands of terrorists not elected by anyone?
    The Prime Minister: That takes the Question rather wider than Rhodesia. I am aware that many people, both European and African, in Rhodesia find it difficult to understand what this House has decided, but this is mainly because of the tight censorship of any statement of our position, and, of course, the police control of the Rhodesian television and radio. Because of this, the Rhodesian regime is able to foster total misrepresentations, such as those about the "Tiger" talks last year and about our insistence on a very long period before majority rule can he achieved not by clock time but by achievement.
    Mr. Sandys: Not wishing to intervene in the controversial exchanges which are taking place [Laughter.]—I do not think that this is the moment to do so—may I simply ask the Prime Minister whether he is aware that the Secretary of State for Commonwealth Affairs will carry with him the good wishes of almost the whole country for the success of his talks in Salisbury?
    The Prime Minister: Yes, Sir. I thank the right hon. Gentleman the Member for Streatham (Mr. Sandys). I am sure that my right hon. Friend will carry those good wishes with him, and in the same non-controversial spirit I should add that I know he will carry the good wishes of all in this House in standing firm for the principles which the right hon. Member for Streatham himself laid down when he held office.
    Sir Dingle Foot: While my right hon. Friend the Secretary of State is in Salisbury, will he seek an opportunity to meet those African leaders who are now in detention and who represent many more Rhodesians than does Mr. Smith?
    The Prime Minister: In these matters my right hon. Friend will no doubt be
    1502
    guided by the Governor, although it will be recalled that when his predecessor, Lord Aylestone, was there on two occasions last autumn repeated and formal requests by him to see the African Nationalist leaders were completely rejected by the régime. [HON. MEMBERS: "For no reason."] Mr. Smith had good reason. He was prepared to allow Lord Aylestone to meet them but Mr. LardnerBurke would not let him.
    Mr. Hastings: Is the Prime Minister aware that independent African Commonwealth countries both north and south of the Zambesi would now be prepared to consider an end to sanctions and discussion of independence?
    The Prime Minister: This matter will be discussed by my right hon. Friend with the leaders of those Commonwealth countries. But I know of no Commonwealth country which wants to sell out to an illegal action or to agree to a betrayal of the principles approved by successive Governments in this country and by this House. They would like to see, as we want to see and have offered, an ending of sanctions, but only on the basis of constitutional legality and the principles that this House has laid down.
    Mr. Park: I understood my right hon. Friend to say that there was no early prospect of majority rule. Will he confirm that this must also imply that there is no early prospect of independence for Rhodesia?
    The Prime Minister: I have already stated, in relation to the Nibmar reference, as it is called, that we stand by what has been said previously in this House—that we should require a very big change in circumstances to justify our going back to other Commonwealth countries on that question.

QUESTIONS TO MINISTERS
Mr. Barnett: On a point of order, Mr. Speaker. You have ruled that Questions put down late in the day would not be answered at Question Time unless you decided that you could call other Questions. You have, however, called Question No. 31, which, clearly, was put down rather late, rather than other Questions.

1503
May I ask whether you have now changed your Ruling?
Mr. Speaker: I regret that I do not understand the hon. Gentleman's point of order. I did not call Question No. 31.
Mr. Barnett: But you did, Mr. Speaker. You have ruled previously, however, that when Questions were put down late in the day you would not give them priority. I wonder whether you have changed your Ruling.
Mr. Speaker: I am sorry, but I am still in the dark. I simply follow the order of Questions on the Order Paper. Questions received at the Table Office take their place chronologically.
Mr. Barnett: Perhaps I can make my point of order clear, Mr. Speaker. You have pointed out previously that when Questions were answered together, if Questions were put down rather late you would not necessarily give priority to them and would call other Questions even though they had not been put down rather late. I wondered whether you had changed your Ruling.
The Prime Minister: Further to that point of order, Mr. Speaker. I think I understand the point being made by my hon. Friend the Member for Heywood and Royton (Mr. Barnett). When a large number of Questions have been put down I have tried, as far as possible, to confine my Answer to those which might normally be expected to be reached on the Order Paper. I believe that this was the guidance you gave to the House some time ago.
But in the special circumstances of the House coming back after a long Recess, I thought it would be desirable to answer more Questions because they had accumulated over a period of time. In general, however, my colleagues and I would, of course, intend to follow the general guidance that you have given.
Mr. Speaker: I apologise. I understand the point now. There are two Questions numbered 31 on the Order Paper. I take it that the hon. Member for Heywood and Royton (Mr. Barnett) is referring to Question No. 31 to the Prime Minister. I did not feel that it was within my previous Ruling that I should apply to it the rule I normally apply to
1504
Questions numbered 60, or 65 or 70 on the Order Paper.
However, there is some validity in the point raised by the hon. Gentleman. When we do have a number of late Questions within the Prime Minister's limited number of Questions something like the Ruling I have given before ought to apply. I am grateful to the hon. Gentleman for raising this matter. I am sorry that I was not seized of the point at first, but there were two Questions numbered 31.
Mr. Hugh Jenkins: On a point of order, Mr. Speaker. Is it in order to inquire the reason for the disallowance of the Private Notice Question which I sought—
Mr. Speaker: Order. It is utterly out of order.

SECURITY (MISS KEENAN)
The Prime Minister (Mr. Harold Wilson): With permission, Mr. Speaker, I wish to make a statement.
In accordance with the statement on references to the Security Commission which I made to the House on 10th May, 1965, and after informing the right hon. Gentleman the Leader of the Opposition, I asked the Security Commission on 10th June to investigate and report upon the circumstances in which Miss Helen Mary Keenan had been charged with an offence under the Official Secrets Act and upon any related failure of departmental security arrangements or neglect of duty; and in the light of their investigation to advise whether any change in the security arrangements is necessary or desirable.
On 25th July Miss Keenan was convicted at the Central Criminal Court of offences under Section 2 of the Official Secrets Act.
On 23rd June, the Security Commission reported to me that there had been no failure of departmental security procedures or neglect of duty. This Report has not been published earlier because there was a possibility of appeal proceedings. Copies of the Report, from which certain details have been omitted in the interest of national security with the agreement of the Security Commission, will be available in the Vote Office this afternoon.

1505
In accordance with the normal practice, the right hon. Gentleman the Leader of the Opposition has seen the full Report and has agreed with the deletions made in the published version.
The Security Commission has made certain suggestions on matters of detail which the Government accept and are putting into effect. But it concludes that only search measures offer any real prospect of providing a better safeguard for documents. A similar suggestion was made by the Security Commission in its Report of June, 1965, and it was then decided not to introduce such searches for the reasons which I explained in my statement of 25th January, 1966.
We have re-examined this matter and have concluded that the decision not to introduce searches should be maintained.
Mr. Heath: I am grateful to the Prime Minister for making that statement in the usual way. As the Security Commission has now come to the conclusion, after considering the Government's views, that a search in some form or other ought to be instituted, does this not now give very great weight to the views which the Security Commission held and, knowing the disadvantages that it has pointed out, ought not the Government to reconsider the whole question?
The Prime Minister: As I have just said, we reconsidered the matter in the light of this second recommendation about searches. As always—and I remember a predecessor of mine making the point several times—one has to hold the balance somewhere in a democracy between security and reasonable personal freedom in these matters. I think that a compulsory search of staffs leaving offices will be regarded by many of us as an excessive intrusion, particularly since there is good reason to think, in the rare case of the individual who was prepared to try and get away with it, that it would not be completely effective.
Dr. Summerskill: Miss Keenan is my constituent and known to me personally. Would not the Prime Minister agree, with the benefit of hindsight, that a young, impressionable and inexperienced girl, new to London, should not have been given access to this information in the first place?
The Prime Minister: With the wisdom of hindsight I think that there are one or two further lessons to be drawn from this case. I do not think that it is a question of newness to London which is the issue here, though the loneliness of some office staffs who come to London from the provinces creates special social problems which this case has highlighted.
Regarding her employment in the Cabinet Office, which automatically means access to secret information, at this time we are looking into the whole question of recruitment for that kind of employment.
Mr. Marten: Was Miss Keenan positively vetted?
The Prime Minister: I would like to check on that. I did have the answer in July, but I have not checked since. As far as I recall, she had gone through most of the stages, but it had not been completed. I think that that was the position. On the evidence available to me, I feel that what went wrong here was not any security clearance, because I do not think that any security vetting could have shown the vulnerability which resulted from the association with the individual concerned.
Mr. Thorpe: I have two questions. First, is it not a fact that when Miss Keenan resigned eight months after taking up her employment the vetting procedures had not been completed and the Commission held that this was normal? If that is so, is not this some case for speeding up the vetting procedures and not having them spread over eight months?
Secondly, since Miss Keenan was only 20 years of age, can we assume that she had not had any previous experience of working in Government Department? In any event, should not somebody who goes into the Cabinet Office have given loyal service first in slightly less vulnerable branches of the Service?
The Prime Minister: The right hon. Gentleman has made a very sound point. The need to speed up procedures has been emphasised and it is one of the lessons of this case.
Recruitment now to the sensitive branches at No. 10 is on the basis of

1507
inviting applications from other Departments where something is known and where there has been experience in sensitive work and we are considering how far that can be applied to other areas where there is this sensitive kind of work rather than by direct recruitment.
Captain W. Elliot: Will the Prime Minister give further thought to this question of search? There are certain areas where searches are carried out on all individuals—for example, at the Customs—but this is a much more important place. If there was a threat of search—andit need not be carried out often—surely it would have a deterrent effect.
The Prime Minister: This is an extremely difficult issue to decide. It was carefully considered on the first occasion when the Security Commission made the recommendation and again on the second occasion. It is very difficult and I feel that not to accept the recommendation probably holds the right balance between personal freedom and the right to some degree of privacy and the security considerations.
I am rather moved towards that view by the fact that search, or threat of search, would not be a complete deterrent or completely effective in the kind of circumstances one might expect on very rare occasions.

SECURITY (MISS KEENAN)

  NEW MEMBERS
  The following Members took and subscribed the Oath, or made the Affirmation required by law:
  David William Stennis Stuart Lane Esquire, for Cambridge.
  Frederick John Silvester, Esquire, for Walthamstow, West.

ORDERS OF THE DAY

  SEA FISHERIES (SHELLFISH) BILL [Lords]
  Order for Second Reading read.
  3.49 p.m.
  The Solicitor-General (Sir Arthur Irvine): Mr. Speaker, I beg to move, That the Bill be now read a Second time.
  On 26th June last this House concurred with the Lords in their Resolution that it was desirable that, in the present Session, all Bills to consolidate enactments with Amendments to give effect to recommendations made by the Law Commissions, together with any report containing such recommendations, be referred to the Joint Committee on Consolidation Bills.
  The present Bill is the first outcome of this procedure, designed to achieve consolidation with such Amendments as appear to the Law Commission to be required for the purpose of producing a satisfactory consolidation. It is right that I should draw the attention of the House to that fact.
  The Law Commission, in the preparation of the Bill, found that to produce a satisfactory consolidation it desired to recommend a number of Amendments, and it reported accordingly. The Amendments recommended have been considered and agreed to by the Joint Committee, which reported that the Amendments proposed to be made to the existing law contained in the Bill gave effect to the recommendations of the Commissions which it approved.
  In broad terms, the Acts which are consolidated in the Bill deal with methods for establishing and improving, maintaining and regulating fisheries for shellfish and for prohibiting or restricting the taking of crabs and lobsters. There are provisions also designed to achieve the elimination or the prevention of the spread of disease and pests affecting shellfish.
  One of the matters revealed by a study of the laws to be consolidated was the degree of discrepancy between the fines for similar offences under different Acts. For taking spawning crab maximum fines

  1509
  ranged from £2 for a first offence to £10 for a second or subsequent offence. For landing lobster carrying spawn the maximum fines were £100 for a first offence and £200 for a second or subsequent offence.
  The Law Commission recommended assimilation of these penalties, reporting without hesitation that existing discrepancies between fines for similar offences were an accidental anomaly. But it reported that it did not think that Parliament would look to the Commissions for advice on the proper level of fines. The maximum penalties in Clause 17, namely, £25 for a first offence and £50 for a subsequent offence are those which the Home Office after consultation with the Ministry of Agriculture, Fisheries and Food recommended.
  With those few observations and bearing in mind that this is the first application of the procedure to which I referred earlier, I express the hope that the House will give the Bill a Second Reading.
  3.53 p.m.
  Mr. Graham Page: May I, first, from this side of the House, welcome the hon. and learned Gentleman in his new office and wish him well personally? From our association in other spheres I feel that I have almost a vested interest, which I ought to declare, in his appointment.
  In this Second Reading debate we are embarking upon a new procedure, and perhaps the House will not begrudge a little time looking at that new procedure and how it affects our discussions. It is a procedure which arises, as the Solicitor-General has said, out of a Resolution passed on 26th June when the House agreed that it was desirable in the present Session that all Bills to consolidate any enactments with Amendments to give effect to recommendations made by one or both of the Law Commissions should be referred to the Joint Committee on Consolidation Bills. As a result, in this Bill we are embodying not only consolidation but recommendations from the Law Commission.
  We therefore have an entirely new wording for the Long Title of the Bill:
  "An Act to consolidate certain enactments relating to shellfish fisheries and shellfish,
  1510
  with amendments to give effect to recommendations of the Law Commission and the Scottish Law Commission."
  The Bill deals with a rather extensive area of the law—orders for fisheries, the grants of several fisheries, the regulation of fisheries and the protection of fisheries, the prohibiting of the importation of shellfish and the close season for oysters. Quite a variety of subjects is dealt with. When consolidation of the subject was studied, it was found impossible to bring forward a reasonable consolidation Bill without introducing new law, new law as recommended by the Law Commission.
  This is a fourth category of consolidation Bills. Previously, we have known the pure consolidation Bill, what one knows as the "scissors and paste" type. Secondly, we have known consolidation with corrections and minor improvements as permitted by the 1949 legislation. We have known consolidation Bills with Amendments which are wide open to debate and Amendment in the House. Now we have a modification of that third category—consolidation with special Amendments recommended by the Law Commission.
  In the report of the Joint Committee on this Consolidation Bill it is said that the Joint Committee considered the Bill, together with the report of the Law Commission and the Scottish Law Commission on the consideration of certain enactments relating to shellfisheries and shellfish. It was of the opinion that the recommendations of the Law Commissions were for the purpose of producing a satisfactory consolidation of the law and the Committee approved the recommendations and, except for one, made no further comments. I will return to that a little later.
  The recommendations are included in Command Paper 3267, the Report from the Law Commissions, and although the Solicitor-General dealt with only one recommendation, there were in fact 10 which have been embodied in the Bill, each of which is new law. As I understand the position, on Second Reading and later in Committee and on Report we are entitled to discuss those recommendations and how far they have been embodied in the Bill. It is true that quite a number of them are matters of small moment.

  1511
  The first recommendation, for example, was a tidying-up of the orders granting several fisheries and regulating fisheries. It was recommended that such orders could combine an order for a several fishery and the regulation of a fishery. No one could object to that. The second recommendation was of much the same type. Under existing law the rights of a person granted a fishery by order are given to someone called a "grantee" and that leads one to believe that those rights would be given only to the original grantee. The Law Commission recommended that that should be tidied up and should therefore include assignees of the original grantee.
  The third recommendation is of far greater importance and relates to the penalties upon a person who refuses to answer inquiries from a seafishery officer. As the law stands, a person who obstructs an inspector or other person in the exercise of any power or right conferred by the provisions to which the particular Section in the 1962 Act apply would be guilty of an offence.
  The Law Commission apprehended that a person who refused to answer inquiries by an inspector might not be guilty of any offence and therefore introduced a penalty for a person refusing to answer questions put by an inspector. It appears in Clause 5 (7) in these words:
  "Any person who obstructs an inspector or other person in the exercise of any power or right conferred by this section,"
  and now the new words:
  "or who refuses or without reasonable excuse fails to provide any information reasonably required by an inspector or other person in the exercise of any such power or right, shall be guilty of an offence and liable on summary conviction to a fine not exceeding £50."
  Where we have introduced such penalties in other legislation, such as the recent Companies Bill which went through the House, protection has been given to the privilege between a legal adviser and his client. That perhaps ought to be considered in introducing this new aspect of the law in Clause 5(7). Perhaps it is a Committee point, but it is a serious matter to impose a penalty on someone merely for refusing to answer questions by an inspector when there is no qualifica-
  1512
  tion of that. He may wish to refuse because by his answers he might incriminate himself, but he cannot do so without being guilty under this subsection. I think that this needs further consideration.
  I go on with the recommendations of the Law Commission. There is a minor recommendation, the fourth, that boroughs be included with counties under the law relating to the trial of offences. Only counties were mentioned in the old law. There is the rather amusing recommendation No. 5, where the Law Commission found that it was an offence to import shellfish by vessel, but, therefore, not by aircraft or hovercraft. So we have the law modernised by the introduction of aircraft and hovercraft as being vehicles in which one is forbidden to import shellfish without authority.
  Recommendation No. 6 makes an alteration in the close season for oysters. I was always under the impression that one could safely say that if there were not an "r" in the month it was a close season for oysters, but apparently that does not work. There was a close season for deep sea oysters and one for other oysters. Now it will all be one term.
  Mr. F. J. Bellenger: A rule of thumb?
  Mr. Page: I do not know about a rule of thumb. I always open my oysters with something more powerful than my thumb.
  Recommendation No. 7 is the important one to which the Solicitor-General referred. It deals with the provisions relating to the catching or selling, or even having possession, of crabs in spawn and lobsters in spawn. The Law Commission drew attention to the extraordinary position that the catching and selling of a crab in spawn might result in a fine of £2, whereas the catching and selling of a lobster in spawn might result in a penalty of £100 for the first offence and £200 for the second offence.
  The Commission recommended that this should be brought in line and left it to Parliament to decide what the penalty should be. The Joint Committee thought that this was a matter which should be left to the House to decide. As a result, in another place an Amendment has been put in the Bill and we now have in the Bill penalties for each of these offences of

  1513
  £25 for the first offence and £50 for the second.
  The eighth recommendation was that as the definition of shellfish bed did not cover a natural shellfish bed but only those which are man-made, the definition should cover both. The ninth recommendation was that the legislation should be applied to the Isle of Man and the Channel Islands, with alterations if necessary by Order in Council. I am a little puzzled why the Isle of Man and the Channel Islands cannot legislate for themselves in relation to shellfish, but I suppose there is a precedent for this.
  The tenth recommendation says that where an order is made under a certain part of the Act of 1868, the order had to be published, actualy published and distributed by the person who had the benefit of the order. That, apparently, had not been done for a long time and the Law Commission recommended that the person having the benefit of the order should be merely required to publish notice of it. I wonder whether that is sufficent.
  It might be advisable to have this requirement to publish the notice that an order has been made granting a fishery and that the beneficiary of it should have to publish a summary of the order to show what it is about. I recollect one which went through this House about 18 months or two years ago in which, when granting a fishery, the Minister had granted the right to impose any fees which the beneficiary of that order chose to fix. This was delegation of the right to tax the public. The order was amended on the recommendation of the Statutory Instruments Committee. I think the public should be told the contents of the Order when notice of it is published.
  The Law Commission recommended the repeal of a number of obsolete provisions of the law. These are matters which perhaps it would be better to consider in Committee. It will be seen from what I have said that these recommendations by the Law Commission have made substantial alterations in the law. It is as well that we in this House should look carefully at those when they are embodied in a consolidation Bill. We have been used to dealing with consolidation Bills as something which just include the existing law and no new law, except for a tidying up with minor corrections and amendments, no new law
  1514
  so far as it concerns merits and real content.
  We have been concerned about whether it is the right time to consolidate and the form in which consolidation has taken place. We are now, under this procedure, presented with a new form of consolidation altogether, something we should study and, it may be, amend. For that reason I have looked carefully at and have drawn the attention of the House to the recommendations of the Law Commission in this case.
  4.9 p.m.
  Mr. Ronald Bell: I intend to ask for the attention of the House only for a few moments. This is the first Bill under the new procedure which, the House may remember, I had considerable doubts about. I still have them. This has been a relatively simple Bill to deal with, but even so there were points of difficulty, as the Solicitor-General will know from having read the Report of the Joint Select Committee. I join with my hon. Friend the Member for Crosby (Mr. Graham Page) in offering my congratulations to the hon. and learned Gentleman on his elevation to his present office.
  The difficulty about this procedure is that members of the Joint Select Committee on Consolidation Bills are the same for every Bill and they are inevitably lawyers, and on this occasion we had to deal with quite a different subject and it is not to be imagined that we are experts on all these subjects.
  When it comes to making actual changes in the law, although the Committee is fortified by the recommendations of the Law Commission it must be the purpose of the procedure that we should bring an independent judgment to bear upon the recommendations. In this case the Committee decided, following the Law Commission, that it should not make any positive recommendation about the amount of the fines in the case of the spawning crabs and lobsters, and, therefore, that was filled in through the wisdom of another place.
  I must confess to still having some doubts about the penalties for not answering questions. The procedure may work all right provided that when Bills come to the House they are treated as ordinary Bills and receive the attention of those

  1515
  hon. Members or those members of another place who are expert in the particular matter dealt with by the Bill. The Bill before us deals with shellfish, and one would naturally hope that hon. Members on both sides who have fishing constituencies and practical knowledge of these matters would be present during the stages of the Bill to consider the not unimportant changes in the law which are brought about.
  The difficulty is that, after all, about a dozen people cannot really hope to spot all the significant questions. For example, my hon. Friend the Member for Crosby mentioned a point which had not occurred to me—I do not think it occurred to any hon. Member—and that is the question of professional privilege in relation to the penalty for refusing to answer questions asked by an inspector under the enforcement provisions. This point can, of course, be considered during the Committee stage if necessary.
  So I retain an open mind about this procedure. I am sure that it will work only if these Bills are given some degree of attention when they come before the House and do not get through under the rubber stamp of consolidation Bills, because the ordinary kind of consolidation Bills to which the House had been accustomed in the past are very different animals from those which will arise under the new Resolution.
  4.14 p.m.
  The Joint Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. James Hoy): The hon. and learned Member for Buckinghamshire, South (Mr. Ronald Bell) says he still has doubts about this type of procedure, but we agree with him that it is a comparatively simple Measure with which we are dealing.
  My right hon. and learned Friend the Solicitor-General would like me to thank both the hon. Member for Crosby (Mr. Graham Page) and the hon. and learned Member for Buckingham, South for the congratulations which they have offered to him, for which I know he is very grateful.
  There are two substantial points here. The hon. Member for Crosby listed 10, but I am sure that he will agree that only two are of any substance. The first
  1516
  is with regard to the answering of questions asked by an inspector. There is some safeguard in the fact that if a man feels that he is to be incriminated he may think that a good reason for not answering, because it is provided that he may reasonably withhold answers. This is much more a Committee point than a Second Reading point.
  As for the alteration in the fines, the present maximum fines for crabs under the Act of 1877 are £2 for a first offence and £10 for a subsequent offence, whereas those for lobsters under an Act of 1959 are £100 and £200 respectively. In any case, we felt that the penalties for lobsters were too high. Those penalties were provided originally for more serious offences. Let us confess on behalf of our predecessors that a mistake was made in the drafting by which lobsters were put into that category. We thought, rightly I hope, that this was the time to put it right. It was for that reason that the changes were made.
  We are grateful to hon. Gentlemen who have given consideration to this matter, and I trust that the Bill will now be given a Second Reading.
  Question put and agreed to.
  Bill accordingly read a Second time.
  Bill committed to a Committee of the whole House.—[Mr. Ioan L. Evans.]
  Committee Tomorrow.

SEA FISH (CONSERVATION) BILL [Lords]
Order for Second Reading read.
4.15 p.m.
The Solicitor General (Sir Arthur Irvine): I beg to move, That the Bill be now read a Second time.
Perhaps, in passing, I may be allowed to thank the hon. Member for Crosby (Mr. Graham Page) and the hon. and learned Member for Buckinghamshire, South (Mr. Ronald Bell) for their kindly references to me, which I assure the House I greatly appreciate.
This Bill does not possess the pioneer features which I earlier indicated attached to the Sea Fisheries (Shellfish) Bill. It is however, an important consolidation Bill which was referred to the Joint Committee on Consolidation Bills under the

1517
provisions of the Consolidation of Enactments (Procedure) Act, 1949. It deals with such matters as restrictions on the commercial use of under-size sea fish and regulating the fishing of sea fish and their landing. It deals, among other matters, with the powers of British sea fishery officers for enforcement, and makes one or two minor corrections to anomalies which appeared in the Acts which fall to be consolidated.
These matters have received the careful consideration of the Joint Committee, as I have already indicated, and I trust that the House will give this useful Bill a Second Reading.
4.17 p.m.
Mr. Graham Page: As the Solicitor-General has said, this is a straightforward consolidation Bill except that it comes under the 1949 Act procedure in that it has corrections and minor amendments to the law.
I should like to know why this has been treated as a subject for a separate consolidation Bill. Could we not have included it in consolidating the law on shellfish? Could we not have consolidated it when we were consolidating the sea fisheries regulations which became the Act of 1966? It seems to me that we are having a number of bites at the—perhaps I ought not to say "cherry"—lobster, white fish or other fish. Why not have it all in one consolidation Bill?
If we really are to consolidate, why keep so many statutes outside the consolidation? The Bill itself refers to a number of statutes which it keeps alive. Clause 5(7) mentions the Acts of 1885 and 1895, Clause 15 to the 1883 Act and the 1962 Act, and Clause 18 to the 1923 Act and the 1963 Act. Why cannot we have all the provisions relating the sea fish conservation included within this consolidation Bill?
I cannot, of course, discuss, and I do not intend to discuss, the corrections and minor amendments which were made on the recommendation of the Lord Chancellor, because this House is bound to accept this as existing law, but I can query and I do query whether this is the right moment to consolidate this law.
I noticed in the evidence given before the Joint Select Committee that Parliamentary counsel who was responsible for the drafting of this Bill made a very
1518
important comment which appears at page 8 of the Minutes of Evidence. It was Mrs. Eadie who was Parliamentary counsel and she told the Committee:
"Two international conventions have just recently been concluded dealing with the policing of fishing and regulation of nets and fishing gear and I understand that the Minister, as a result of those conventions, will find it necessary to examine the Act of 1883 in detail and may well have to ask Parliament to amend that Act."
When Parliamentary counsel gave that evidence the Committee was dealing with Clause 15, the powers of sea fishery officers, which are very important, because they may very seriously infringe the liberties of the subject—quite properly, perhaps; but sea fishery officers do have very great powers of entry and of seizure and of questioning and so on. The Joint Select Committee did substantially amend the draft Bill before them in dealing with these powers, and it was in the course of discussing those amendments that this evidence came forward from the Parliamentary counsel.
I would ask the hon. and learned Gentleman, is this so? Are the Government contemplating an amending Act very soon? If so, would it not have been better to have referred this Sea Fish (Conservation) Bill to the Law Commission in the same way as the previous Bill we were debating was referred? It might have come forward to this House with those amendments and the House could perhaps have avoided a further Bill. This, as I understand it, is further consolidation. We shall be taking three or four bites at this cherry before we are finished, if it is in fact the intention of the Government to bring forward legislation to comply with the Conventions. I would ask that further information be given to the House on this, so that the House can decide whether it is the right moment to consolidate such powers.
4.24 p.m.
The Joint Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. James H. Hoy): I will try to reply briefly to the two points which the hon. Gentleman the Member for Crosby (Mr. Graham Page) has raised. First of all, it is true to say we could have tried to have had them together in one go, but, as he knows, these are various

1519
Measures which refer to different countries; one applies to England and Wales only, one applies to England and Scotland, and so on. Inasmuch as we are making progress in consolidation I would have thought that the hon. Gentleman would have been grateful for that much.
Then secondly, he is surely aware that there is with regard to boarding at sea an international Policing Convention under which very substantial changes have been proposed and which has already been agreed to by some countries. This would allow the boarding of a ship by nationals of other countries if the vessel were suspected of fishing illegally. If this were to happen it would mean legislation would have to be introduced to meet it; so we obviously have to be free to act if agreement is reached.
Question put and agreed to.
Bill read a Second time.
Bill committed to a Committee of the whole House.—[Mr. Ioan L. Evans.]
Committee Tomorrow.

LEASEHOLD REFORM BILL
Order read for consideration of Lords Amendments.
4.28 p.m.
Mr. Speaker: Before we come to consideration of the Lords Amendments I think that it would help the hon. Member for Crosby (Mr. Graham Page) and his hon. Friend if I told him which of his Amendments to the Lords Amendments have been selected and which have not been selected.
The hon. Gentleman's Amendment to Lords Amendment No. 1, to line 4, is not selected. Amendment at line 7 of Lords Amendment No. 2, is not selected. His Amendment to Lords Amendment No. 5, page 5, line 5, is selected.
Of the hon. Gentleman's four Amendments to Lords Amendment No. 11, page 5, line 41, I am calling the first one, with which we are taking the second.
The Minister of State, Ministry of Housing and Local Government (Mr. Niall MacDermot): The second or third?
Mr. Speaker: The second. We must be clear. Of the hon. Member's Amendments in that group I am taking the one to line 1, with which we shall discuss the one to line 7.
Mr. MacDermot: The hon. Member has two Amendments to line 7 and I wonder which you mean, Mr. Speaker.
Mr. Speaker: The second Amendment. The first one is not selected. The one at line 8 is not selected.
The hon. Member's one Amendment to Lords Amendment No. 14, page 6, line 45, is not selected. His Amendment to Lords Amendment No. 18, page 13, line 43, is not selected. His first three Amendments to Lords Amendment No. 22, page 24, line 33, are not selected. I have selected his two Amendments, at line 7, and line 10, which we shall take together.
I have selected the hon. Member's last Amendment—the Lords Amendment No. 62, page 81, line 43—his Amendment to line 6, but not the previous one to line 3.
I hope that that is of help to the House.
Mr. Graham Page: On a point of order. I understand that it is

1521
debatable whether the Lords Amendments should now be considered. I do not know whether the right hon. and learned Gentleman has put the proposition to the House?
Mr. Speaker: It has to be moved before we can debate it.
Mr. MacDermot: I beg to move. That the Lords Amendments be now considered.
Mr. Page: I do not think that we can let this Motion pass without some protest and objection. But before I do object to the Motion I would observe that I am having quite a distinguished afternoon in being able to congratulate two Ministers on the same afternoon, and I do sincerely congratulate the right hon. and learned Gentleman upon his new appointment. We do welcome him personally; we wish him well personally. We will give him hell Ministerially—we hope. But we do congratulate him upon his appointment.
I have great sympathy with the right hon. and learned Gentleman. When the House rose for the Summer Adjournment the Second Reading of the Bill had not been reached in the other House. The right hon. and learned Gentleman had to thumb his way through the Official Reports of the other place, as we did, to find what Amendments had been made in Committee and on Report there. He, of course, had officials to help him; we had only scissors and paste in finding out from the Official Reports what Amendments had been made. We did not have them in print until five o'clock yesterday. The right hon. and learned Gentleman, no doubt, wanted to table Amendments, as he has done, to the Lords Amendments, and reject some which were made in another place. But how could one make amendments when we did not have them in print and know to what lines reference should be made in making Amendments until about five o'clock yesterday?
The right hon. and learned Gentleman was most courteous to me in informing me of the Amendments which the Government were to put forward on Third Reading yesterday in another place. I thank him for that courtesy. However,
1522
I am not the House, and I am not all hon. Members. It is right that the House should know in advance what it is debating the following day. It was quite impossible for anyone to discover until late yesterday what Lords' Amendments were to be debated today. It was not possible until this morning for those of us who wished to make Amendments to the Lords' Amendments to so inform the House by means of the printed Amendment Paper.
It is true that the proofs of the Lords' Amendments were rushed through with great speed between five and six o'clock yesterday. This was all part of this dynamic Government, and we are grateful to the Public Bill Office for the efforts which it made. Through its help, I was able to make the line references to the Amendments which I wanted to put down on the Order Paper.
This is a most unseemly rush in connection with a Bll of this kind which is nearly as complicated as the Land Commission Bill. It needs a great deal of thought. Where Amendments are introduced at this stage, one has to be able to see the results of those Amendments, not only by their own wording but the effect of them upon the rest of the Bill.
Already the Bill reaches us with an error on page 6, line 43, where there is a mistake which cannot be put right now and may necessitate alteration whenever an application is made under the Bill to apportion rateable value between a house on one side and the garage, garden and garden shed on the other. That is what happens when legislation is rushed through.
I do not know whether it is bad management on the part of the Government to rush through legislation in this way, or whether it is just arrogance in thinking that what the Government want can be steamrollered through the House without informing us fully beforehand and giving us a chance to think out the problems raised by the Lords' Amendments.
I protest at this treatment of the House. This is a particularly difficult piece of legislation to understand and interpret, and it needs very careful thought before we put it on the Statute Book in its final form.
4.34 p.m.
Mr. John Peyton: I want to endorse what my hon. Friend the Member for Crosby (Mr. Graham Page) has said about the right hon. and learned Gentleman. Certainly, we wish him well and congratulate him on his promotion. We hope that he will enjoy his new office. I personally welcome the opportunity to say something nice to and about a member of this Administration.
However, I am particularly concerned to support and thank my hon. Friend the Member for Crosby (Mr. Graham Page). It is not always that one hears a Front Bench spokesman, while acknowledging the courtesy which has been extended to him, resenting on the part of those behind him the discourtesy which has been extended to them. I desire to endorse With all the strength that I can the remarks which he has made about the mixture of incompetence and discourtesy with which the House is being treated.
It is becoming a habit. It is unfortunate that Ministers are so inured to our protests that they take little notice of them and do nothing to mend their ways. It is something which we are learning to endure somewhat painfully, but I am certain that some of my hon. Friends will wish to voice their views about this kind of treatment.
By no standard is this unwelcome legislation to us, but by no standard is it easy to comprehend and understand. For the Government to have made such a shocking confusion of their programme that we are told only at the very last minute of their views on the Amendments proposed in another place is quite a disgraceful affront to the House of Commons. I do not recall, on any major legislation which I remember that we have been presented with a paper of Amendments every one of which was starred.
I rather hoped that, when the Minister rose to move this Motion he would seek to express regret that the House had had so little notice of it, It seems a quite intolerable burden, and I hope very much that my hon. Friends will agree with me and support my hon. Friend the Member for Crosby in his very mild and restrained protests at the combination of bad manners and inefficiency with which, once again, the Government have treated the House of Commons.
Mr. MacDermot: I thank both hon. Gentlemen for the courteous parts of their speeches in which they made kindly references to me. If the hon. Member for Crosby (Mr. Graham Page) thinks that I am likely to be given hell in my new office, and this is a sample of it, it is to me a very familiar type of debate after my long experiences on Finance and other Bills in my previous offices.
I agree that this is a matter which, perforce, has had to be dealt with in haste and that we have not been able to give the House the length of time to consider these Amendments which we should have liked or which normally would have been given. To achieve that, probably it would have been necessary to recall Parliament earlier. On reflection, hon. Gentlemen themselves will see that that was not really necessary when they come to consider the Amendments. For the most part, they are relatively minor matters. Where they are not, I think that they will be found to be matters which have been debated very fully before.
The hon. Member for Crosby said that I was courteous enough to let him have advance notice of the Government's Amendments. In return, he was equally courteous and had time to let me have advance notice of his Amendments to those Amendments.
Question put and agreed to.
Lords Amendments considered accordingly.

Clause 1.—(TENANTS ENTITLED TO ENFRANCHISEMENT OF EXTENSION.)
Lords Amendment: No. 1, in page 2, line 6, at end insert:
"(2) In this Part of this Act references to a leasehold house shall not include a house situated on land belonging to a landlord which is an institution, organisation or trust established for charitable purposes."
4.38 p.m.
The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. Arthur Skeffington): I beg to move, That this House doth disagree with the Lords in the said Amendment.
The Amendment from the other place goes to the very heart of the Bill. It concerns a vital policy issue and I cannot disguise that, were it to be accepted,

1525
it would go to the very fundamental purpose of the Bill. It would deprive a residential occupying lessee from the benefits of the Bill, not because he had himself done something which would put him outside the scope of the Bill, not because he was unworthy or deserved any less justice than anyone else, but simply because he had the misfortune, first, to hold the property on leasehold tenure and, second, to have it from a charity. Such a proposition is totally unacceptable to the Government.
The differences among those who would like to treat this category of land-lord in a different way are well known. They do not go to the merits of charities at all. The issue is whether, in a general Act of Parliament, it is possible to single out one group of tenants or landlords and give them exceptional and different treatment.
We canvassed these arguments very fully in Committee on 11th May, and in this House on Report on 20th June, when a new Clause having a somewhat similar effect was moved and withdrawn. I do not think, therefore that I will be held to be discourteous if I do not recapitulate all the arguments which were raised on those occasions, and indeed when the Amendment was discussed in another place.
The broad position is that the Government say, and said in the White Paper containing their policy statement for leasehold reform, that it was
"quite indefensible, if justice is to be done as between the freeholder and occupying leaseholder, that at the end of the term, the law should allow the ownership of the house to revert to the freeholder without his paying for it so that he gets not only the land but also the house, the improvements and everything the leaseholder and his predecessors have added to it."
That is the general proposition.
I understand that to a degree at any rate, that proposition is accepted by all parties in the House. We are told that all parties accept the need for reform, and accept enfranchisement as one of the methods of achieving it. I remember one hon. Gentleman on the Opposition Front Bench, both here and upstairs, saying that all members of his party were enfranchisers, and I am sure that this would be found to be true of the Liberal
1526
Members, were any of them present to intervene in the debate.
If that is the case, if it is a general proposition that the law has to be further amended—and this is perhaps only a larger and more radical reform than that which took place in 1954, and earlier in 1927—one has only to state it to see how difficult it would be to take out a large body of leaseholders from that proposition.
I said just now that if the Amendment were accepted it would knock the heart out of the Bill. As far as we can estimate, about 1 million—and possibly more—leasehold houses will be affected by the Measure, and I think it is true to say that at least 300,000 people are occupying leasehold houses owned by charities of one kind and another. It would therefore be a novel principle to say that because of the character of the landlord, which is not in question, or because of what he does with the funds which may arise from his leasehold investment, there can be different treatment for him in general legislation.
That was not recommended by the Departmental Committee which heard many representatives of the charities and the property owners. No one suggested that special treatment should be given to charities. It was not a course which was followed in the 1954 Landlord and Tenant Act. Indeed, as has been said from this side of the House on a number of occasions, the effect of the 1954 Act on the investments of charities and others might have been even more marked as a result of this Measure. There was no suggestion that there should be an exception. Charities were not excluded under the Rent Act. They were not excluded from the betterment levy in respect of their investment land. At this stage it would be a novel departure, not hitherto recognised in English law, to exclude them; and, at the same time, to do so would deprive a considerable body of leaseholders of the benefits and protection of the Bill.
I have, unfortunately, had the misfortune to represent two constituencies in which there have been some leasehold interests, and I can assure the House, if it needs an assurance on this, that where leaseholders are at the end of their term, or where they are suffering from the

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vexations and frustrations which they feel under the leasehold system, it matters little to them if the landlord is a property company, or a charity. I therefore must reaffirm the line which the Government have taken from the beginning, namely, that they cannot possibly accept the Amendment, and if it is pressed to a Division I must ask the House to disagree with it.
4.45 p.m.
Mr. James Allason: I am sure that the Government would not wish to tax charities, if for no other reason than that to do so would make them even more unpopular than they know they are at the moment. The question is whether, by this Measure the Government are taxing charities, and with great skill the Parliamentary Secretary omitted that consideration.
The question is whether the terms of compensation laid down in the Bill are fair. If they were, there would be no suggestion that there was any necessity to exempt charities, but all the arguments that we have heard show that charities will lose substantial sums of money through the operation of the Bill. There is no doubt that the terms of compensation are unfair.
When this Measure was considered on Report, the hon. Lady the Minister of State, Welsh Office, said:
"… we were influenced to a degree by some of the wealthier members of the Socialist Party who were shocked when they discovered the enormous tax free capital gains which they were liable to make under the Bill if the limitations were removed entirely."—[OFFICIAL REPORT, 20th June, 1967; Vol. 748, c. 1532.]
The right hon. Lady was referring to the rateable value limitations, and because of the enormous tax free capital gains which were to be made under the Bill the Government restored the rateable value limit.
The effect is that they have abolished "enormous tax-free capital gains" and have substituted "substantial tax-free capital gains". This apparently, is the new Socialism—a present from the Government of up to £10,000 to the tenant, at the expense of the landlord. This is good Socialism, but if the figure is above £10,000 it becomes enormous, and, therefore, is abolished.
Whatever view hon. Gentlemen opposite may hold about substantial tax-free
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gains at the expense of a landlord, surely no one would support substantial tax-free gains at the expense of a charity? I object to this when it involves a landlord, but when a charity is involved I think that the provision is doubly objectionable.
The Joint Parliamentary Secretary said that the House had accepted the need for enfranchisement. I do not think that the House has accepted the need for all the provisions to which he referred. The House has agreed to enfranchisement on fair terms. The hon. Gentleman went on to say that there could not be any exceptions to these provisions, but this is precisely what the Bill does. It provides for exceptions, for instance when redevelopment is required by local authorities, by the Commission for New Towns, by nationalised industries, by hospital boards, and by universities. In such cases the tenant will lose the benefit of enfranchisement which the hon. Gentleman said must be granted to all tenants. He cannot ride that horse.
I think that it would be better if the hon. Gentleman were to reconsider the position with regard to charities. The object of the Bill was to deal with cases of hardship. Nobody has managed to quote an example of hardship involving charities. They are recognised as good landlords. They do not oppress their tenants, and I think, therefore, that it would be reasonable to exclude them from the Bill.
Sir Barnett Janner: I cannot see that the argument put forward by the hon. Member opposite has any relevance to the points made by the Minister. I do not know whether the House realises that the question of leasehold reform has been on the cards for many years. For 20, 30, 40, or more years everybody has known that at some stage or another it was intended to introduce this reform, although perhaps not in precisely these terms.
Everybody knew it—charities included. Consequently, anything which they acquired within the last 50 or 60 years should have been acquired with the knowledge that at some time the law would be amended so that the tenant could not be dispossessed. I should have thought that that was obvious to anyone who was negotiating a deal—certainly in Wales.

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I cannot see why charities should be exempt from the provisions of the Bill and why an individual should be turned out of his home because the landlord happens to be a charity. I do not think that the House would want to carry out an uncharitable act in respect of an individual who happens to be in possession of the premises in order that a charitable act may be done in respect of somebody else, for another purpose.
The Lords Amendment would defeat the objects of the Bill. It is a wrecking Amendment, and in the circumstances the Government are right not to concede the point which the Opposition have attempted to make, but which cannot reasonably be made in favour of the Amendment.
Mr. Percy Grieve: I hope that the House will agree to the Lords Amendment. I do not agree with the Parliamentary Secretary that the Bill has almost universal approval in the House. Had the Bill given proper compensation and not unfair compensation for the enfranchisement of leaseholds it may well have had the approval of almost everyone in the House, but the criticism which has constantly been made by hon. Members on this side of the House is that the compensation given is grossly unfair. This is exemplified by the fact—it is well known; case after case has been cited in our debates—that those who enfranchise their leases will make considerable capital gains.
Sir B. Janner: I ask the hon. and learned Member to excuse me for leaving, for purposes of which he is aware.
Mr. Grieve: Considerable capital gains will be made by those who enfranchise their leases. The matter that we are now debating is the question whether those capital gains should be made by ordinary private individuals at the expense of charities. This is a question which the House must answer. Are we to benefit citizens financially, on a large scale, at the expense of charities? My hon. Friend the Member for Hemel Hempstead (Mr. Allason) said that he was sure that the Government would not wish to tax charities, but the record of the Government in that respect is singularly bad.
During the last two years we have had example after example of attempts by
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my hon. Friends to remove taxation from charities, all of which attempts have been strenuously resisted by the Government. We have had example after example of taxes imposed upon charities which the Government have insisted in maintaining. Only after a lengthy debate on Amendments moved by hon. Members on this side of the House were charities relieved from Selective Employment Tax. I believe that it was in July when we sought to exempt charity Christmas cards from taxation and were resisted strenuously by the Government. They maintained taxation on those cards.
I do not often find myself in complete agreement with the observations of Socialist Ministers, or even ex-Socialist Ministers, but I was very impressed by what Lord Shawcross said in another place, and found myself in complete agreement with it. He said that nothing so confiscatory as this Bill had been put on the Statute Book since the reign of Henry VIII. That is so. The Bill taxes charities; it benefits private citizens at the expense of citizens. The Amendment is designed to exempt charities from the ill effects of the Bill and I hope that the House will accept it.
Mr. S. C. Silkin: On more than one occasion in our debates on the Bill I have declared my interest, and it is only right that I should do so once again on the Lords Amendment. As a lessee of a trust for what are called charitable purposes in law I am directly affected by the provisions of the Amendment. By a most extraordinary and no doubt wholly unintended coincidence the noble Lord who introduced the Amendment in another place happened to refer to the very road in which I live as an instance of the evils which would be incurred if the Amendment were not accepted.
I can well understand the argument that charities should benefit from the taxpayer. I can understand the argument that, on occasions, charities should benefit from the contributions of ratepayers in the areas served by those charities—and I would like to see a somewhat better definition of a charity than exists at the moment, in order to give proper effect to that principle—but I cannot understand the arguments of those who suggest that charities should benefit not only from the taxpayer and the ratepayer but also at

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the expense of the lessees from whom they draw their incomes.
Mr. Grieve: Does the hon. and learned Member not agree that the vice of the Bill is that it benefits certain individuals in the community and not the whole of the community, at the expense of another set of individuals in the community, namely, the owners of leasehold houses?
Mr. Silkin: The hon. and learned Gentleman is inviting me to debate the question of compensation. I am sure that I should be ruled out of order, Mr. Deputy Speaker, if I complied with that proposal in a debate on this Amendment.
Since the Dulwich College Estate—which is in my constituency and which was made so much of in the other place as an example of the type of estate covered by the Amendment—has been in issue, however, it is only fair to say that the policy of that estate—and no doubt of most well-managed estates—is that when houses have reached the end of their leases, although by no means necessarily the end of their lives, they should be demolished and redevelopment should then take place.
5.0 p.m.
In other words, estates of that kind expect to secure their income out of the redevelopment value of the land. The compensation provided by this Bill is precisely the redevelopment value of the land. This point has been made again and again, but it has never been adequately reviewed. I return to the point that I was making before I was interrupted and it is quite simply that if one says that a charity is to be treated in a different way from other freehold lessees holding residential leasehold property, what one is really saying is that a lessee who happened to be a lessee of a charity should subsidise his freeholder in a way which other lessees are not required to do by the Bill.
I cannot see any conceivable justification for such a division, and some of the justifications that have been made in another place and elsewhere have been quite extraordinary. It has been said, although what this has to do with charities I do not know, that if the Bill goes through without the Amendment proposed and
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adopted in another place, which we are now discussing, the green areas of my constituency would gradually deteriorate into slums.
I must say that it is a fine comment upon the people who live in my constituency, in particular upon the Dulwich College Estate. I wonder whether they would be gratified to hear that suggestion made about their own future sense of duty and their sense of amenity by the noble lord who introduced the Amendment in another place.
There is no ground whatever for treating charities in any different way from other freeholders when one is dealing, not with taxation matters, but with matters between one citizen and another. For that reason I hope that the Government will stand firm and will not accept the arguments that have been put forward on the other side.
Mr. John Peyton: We are accustomed to hearing extraordinary arguments adduced from time to time. [HON. MEMBERS: Hear, hear."] Those which we have heard from the hon. Member for Leicester, North-West (Sir B. Janner)—I am sorry that he is not in his place—were of the oddest. He castigated this Amendment on the basis that it was a wrecking one. In our view the fact that an Amendment is wrecking, when aimed at a Bill of this kind, is a positive virtue. The hon. Gentleman's second argument was even odder. He said that everyone had known for a long time that there was a possibility of legislation.
If everyone is to conduct their affairs in such a way that they must treat themselves as being on notice of certain legislative possibilities once some crackpot politician or political party of unsound judgment has delivered its ideas on the subject, when divorced from office, then there would be even more paralysis in the country than there is at present. It is a most extraordinary argument for the hon. Gentleman to put forward. It is a strange notion, and I do not think that it could come from any source other than a Socialist one.
Our objection is that this Bill is aimed at dealing with the oppressive landlords and it is a reflection of the remarkable utterances which came from the right hon.

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Gentleman, who unfortunately is Leader of the House, when he said "I have a prejudice against landlords." It is an odd thing to come from the lips of a Minister who was contemplating legislation. It devalued—not that that was necessary or effective for those of us who are more in touch—but for the general public it must have immensely devalued his every utterance on this subject, for which he had Ministerial responsibility.
It was a plain admission that he was a prejudiced witness. There is no charge against charities that they are unfair or vicious landlords. They are known to be good and fair landlords, who take a long-term view of the interests of their property and certainly would not wish to have the reputation of having bullied or deprived their tenants of their fair rights.
As my hon. and learned Friend the Member for Solihull (Mr. Grieve), rightly said, if there were fair terms available to charities for loss of their rights I dare say that a lot of the objections which we are now expressing would fall to the ground. But there are not fair terms available. My hon. Friends have been absolutely right in expressing their indignation at the way in which the Government have callously and carelessly overridden the rights of charitable organisations.
It seems that they prefer the integrity of their own wretched Measure rather than violate it by a degree of justice. I find this shocking, regrettable and even surprising, even though it comes from a Government which has shown an addiction to dogma rather than to good justice.
Mr. A. P. Costain: I wish to support my hon. Friend the Member for Hemel Hempstead (Mr. Allason) in resisting these proposals. I would also like to declare an interest. I am the trustee of a large charitable organisation, some of the income of which depends upon ground rents. I am quite astounded by the arguments put forward opposite. The Front Bench opposite seem to be saying that this cannot be done because there are too many houses involved.
The hon. Member for Leicester, North-West (Sir B. Janner) made a short speech and then left, on the basis that his mind
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was made up. He argued that the tenants might be dispossessed of houses by a charitable institution. It is highly unlikely that a charitable institution would want to dispossess. Such institutions are among the best landlords.
The hon. and learned Member for Dulwich (Mr. S. C. Silkin) raised an extraordinary argument, that the charitable organisation which had bought these properties, as a reasonable and safe investment, should have them confiscated and they should be given away to the sitting tenant for a lower price. The hon. Member is saying that he ought to have the benefit of the charity's property.
The Government seem to be hell-bent on attacking charities. I have come to the conclusion that charities are a form of private initiative and private enterprise, and the Socialist Party is against this, whatever it is. Charities must fall because of a doctrinaire approach. We will have difficulty in persuading the Front Bench opposite of its folly, but I hope that my hon. Friends, and our friends in the country will take every opportunity of showing the Socialists how wrong they are.
Mr. Skeffington: If I may speak again, with the leave of the House.
There has not been general disagreement with my major proposition, that when one is enacting a national law it would be novel and almost without precedent to stipulate a category of landlords who should be better treated, and a category of tenants who will be worse treated because of the nature of their tenure. This proposition remains true and has only to be stated for its practical force to be seen. This is coupled with the fact that there was no suggestion in the report of the departmental committee in 1950 or in the 1954 Landlord and Tenant Act that charities which were adversely affected then, as they may be now, were to be exempted. That must remain, under all Governments, a general proposition.
The hon. Members for Hemel Hempstead (Mr. Allason) and Yeovil (Mr. Peyton) did not think that the case could be generally made out that charities were worse landlords than any other group and I am sure that this is the intention of the charities themselves. However, it was pointed out in Committee that many

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of those conducting the business of charities, by the very law under which they operate, have sometimes far less discretion than does a private company because, generally, they are charged with getting the maximum return on the funds invested.
When I was associated with one of the bodies mentioned today and in another place and was an officer of one of the relevant associations, we had innumerable examples of those acting on behalf of charities being forced to take a line of action which at any rate went to the utmost rigour of the law. No one was blaming the individuals—those were the circumstances in which they operated—but this is not grounds for saying that, because an organisation is a charitable body, therefore it must behave in a certain way, better than anyone else, and deserve better treatment, because experience is that things do not work out like that.
Another argument put forward related not to exempting charities but to whether or not the compensation is right. If there is to be a leasehold enfranchisement scheme, the basis for it in paragraph 11 of the White Paper was that the land belonged to the landowner, but that what was on it belonged to the leaseholder, and that is the formula in the Bill. There is no grounds for suggesting that this is inequitable or unfair to any category of landowners, when one considers all transactions.
But all these arguments boil down to this—what we are trying to do in this legislation, I thought with the general agreement of the House, is to provide that 1 million people will have the opportunity of regarding their homes as their own, because they can have the compulsory right of purchasing the freehold or extending their lease. This is all that the Bill does and, at this stage, to attempt either another basis of compensation, as is implicit in many of the arguments put forward today, or to exempt this substantial body of tenants would be to knock the heart out of the Bill. Therefore, I hope that the House will express its strong disagreement with the Amendment.
5.15 p.m.
Mr. Graham Page: I am sorry that the Parliamentary Secretary has so firmly
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rejected any sort of compromise on this provision. He said that we were talking about 300,000 houses out of the 1 million-plus which will be affected by the Bill. I am surprised by the size of that figure and would not have thought that so many houses were held by charitable landlords or landlords and charities, but perhaps the definition of a charity has been extended rather wide, in view of that figure.
However, if it is true that 300,000 houses are involved, that shows how much of the funds given to charities is to go into the pockets of unintended beneficiaries under the Bill. These houses are to be sold at less than market value: this cannot be denied. The evil which the public, with approval, see this Bill as combating and remedying—although I think that it would be remedied in other ways—is to prevent the extortionate demands upon tenants at the fag ends of their leases. No one wants that and no one can accuse Dulwich or Bourneville of acting in that way. I was shocked at the Parliamentary Secretary's side swipe at the administration of charity landlords. They have been the finest landlords in the country and have produced estates of which we are very proud.
Second, compensation is not, under the present law, market value and, therefore, the Bill will be taking away an asset of the landlord. Some hon. Members may think that there is ethical justification in the case of the private landlord, that he deserves all that is coming to him. But when the landlord is a charity, from whom are we taking that asset and that money? Not from the landlord, but from the beneficiaries of the charity, like Alleyn School, Dulwich College, the picture gallery at Dulwich—[An HON. MEMBER: "Who wants to keep that up?"] There may be strength in that remark, but it is a matter of opinion. I am on sounder ground, perhaps, in talking about the ancient traditions of the schools there, whose income and capital will be very greatly reduced.
In Bourneville, the beneficiaries are the tenants themselves. This is an organisation such as we know in the housing society and housing association world. One may say that this is just a grand share out among the beneficiaries, but there are many rack rent tenants on those

1537
estates and there is the question of good management of the estates and of their proper future development.
The hon. and learned Member for Dulwich (Mr. S. C. Silkin) said that it was nonsense to talk about enfranchised estates slipping into slums. It may be nonsense in regard to individual houses, because probably a tenant who has acquired his freehold or an extended lease will devote greater time to his house and keep it well, but it is the common amenities which will deteriorate. The Bill does nothing to solve the problem of estates with common amenities, except under Clause 19, but, as I said of that Clause before, "Thank you for nothing".
No one will take the responsibility under Clause 19, not even the charities—
Mr. S. C. Silkin: The hon. Gentleman says that no one will take advantage of that Clause. Is he giving an undertaking that the Dulwich College Estate will not do so?
Mr. Page: No, I hope that the Dulwich College Estate will seek other ways of doing it, perhaps through this House. I certainly hope that the Estate will be preserved, despite the Bill. I am sure that no one thought of charities being deprived of these substantial sums, both of capital and of income, when they read the White Paper or even when they saw the draft Bill.
Of course, the solution might have been to allow tenants of charities to have extended leases, but not the freehold. The solution might have been to give proper compensation. In that case, the position would not have been so bad for the charities.
The Parliamentary Secretary has made great point of what he called a general proposition that this was a national law, that all tenants should be treated alike and that tenants should not be deprivileged or suffer disadvantage merely because they were tenants of a certain landlord. The hon. Gentleman has not read on in the
Bill, because that is exactly what Clause 29 does.
Why, under Clause 29, is a local authority allowed to deny a tenant the right to enfranchise and yet a charity is not? Why is a commission for the new towns entitled to deny enfranchisement and a charity is not? Why is any university body, university college or the university itself allowed to refuse enfranchisement and a charity is not?
Why is a regional hospital board, a hospital management committee or the board of governors of a teaching hospital in a better position that the governors of Dulwich College, or that charity or teaching institution? Why can those bodies deny a tenant the right to enfranchise? Why should a nationalised industry be allowed to refuse enfranchisement if a charity is not? To wind up this list, why should a harbour authority and a statutory water undertaker be allowed what a charity is not allowed?
This completely pulls the rug from under the hon. Gentleman's feet whet he puts forward his general proposition that every tenant must have the right to enfranchise and that we must not make any distinction. Yet there are those distinctions in the Bill.
It would have been right and proper for the Government to accept the position and say, "We never intended this to happen when we produced the White Paper. We never intended to deprive these charities of their capital and income in this way and we are prepared, if they satisfy the Minister that they are running the estate well, that they have plans for proper development and are treating their tenants properly, to let them go on and refuse the tenant enfranchisement." The Government are simply being obstinate in saying that they want the Bill as a national law applying to everybody.
Question put, That the House doth disagree with the Lords in the said Amendment:—
The House divided: Ayes 207, Noes 127.
Lords Amendment No. 2: In line 31, at the end insert:
"(5) Notwithstanding anything in subsections (1) to (4) of this section, this Part of this Act shall not confer on the tenant of a house any right by reference to his occupation of it as his residence if the house forms part of an estate which on application made by the owner to the High Court either before the appointed day for this Part of the Act or within not more than three months thereafter is certified by the High Court as an estate held under statutory enactment or trust deed the purpose of which is to maintain the entity of the freehold estate and that on the date of application to the High Court the owner of the estate was required to have regard only to the letting value of the site (without including anything for the value of buildings on the site) in granting to a tenant of a house and premises an extension or renewal of an existing long tenancy at a low rent:
Provided that in the event of the conditions not continuing to apply to the estate the High Court on application by the Minister of Housing and Local Government or the Secretary of State shall be empowered to cancel the certificate and thereupon this Part of this Act shall apply to the estate as from the date of cancellation of the certificate.
In default of agreement between the owner of the estate and a tenant of a house held on a long lease at a low rent as to the letting value of the site of the house and premises the provisions of section 21 of this Act shall apply as if it were rent to be fixed under section 15."
Mr. MacDermot: I beg to move, That this House doth disagree with the Lords in the said Amendment.
This Amendment, which was carried in the other place, is identical with one
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which was moved unsuccessfully by the hon. Member for Hove (Mr. Maddan) in Committee.
The Amendment was avowedly designed to exclude Letchworth from the Bill. It has, however, been framed in general terms, as it had to be, to avoid turning the Measure into a hybrid Bill. The result of this is that the benefits of the Bill would be taken away from leaseholders in any estate which, on an application by the owner to the High Court not more than three months after the appointed day, could be shown to be held under a statutory enactment or trust deed, the purpose of which is to maintain the entity of the freehold estate, and which involves a requirement on the owner to have regard only to the letting value of the site if he grants an extension or renewal of an existing long tenancy at a low rent, without, however, invoking any requirement on him to extend or renew such a lease.
This goes far too wide, particularly in including estates held under trust deed. It would be quite possible for an ordinary landlord to execute such a trust deed, and thereby avoid the provisions of the Bill as to enfranchisement, without even being under any obligation to renew or extend leases. The defect of the Amendment is inherent and irremediable because it was drafted both to be wide enough to bring in Letchworth and also to be wide enough to be of general application and not a local measure purporting

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to be a general one. Any attempt to narrow it would be liable to exclude the Corporation or to hybridise the Bill. The dilemma is inevitable in any attempt to meet, by general provision, some situation which is thought to be unique.
Having said that, I wish to make it clear that I personally have some sympathy with the objects of the movers of the Amendment. But even if it were possible in this Measure—which, for reasons I have explained, it is not—to exclude Letchworth, I do not think that that would be a satisfactory solution to the problem. It is clear that there is, to say the least, a substantial body of leaseholders in Letchworth who are anxious to obtain the benefits of enfranchisement. They would resent it very much if they were deprived of the advantages of the Bill; and I see no reason why they should be.
On the other hand, Letchworth Garden City is something quite unique in our social history. It pioneered an idea which has an important part in the philosophy of the Labour Party and which, I think, is accepted by some hon. Gentlemen opposite. It is the idea that the profit arising from the development of land is something which was created by the community and which should, at least in part, return to the community.
At the time of Ebenezer Howard the only practical way of achieving that was by adaptation of the long leasehold system, but many people now feel that this way of achieving that object is something that has become somewhat out of date. It has been overtaken by other changes in the law, including, in particular, this Measure to grant leasehold enfranchisement.
On the question of the development of land—or, as people in Letchworth call it, the "incremental value"—belonging to the community, there would be no problem if Letchworth Corporation were a local authority because it could then, on enfrachisement, reserve its development rights under the provisions of Clause 30(1). However, there is no point in our seeking to give a similar power of reservation to Letchworth Corporation under this Measure because that Corporation has no power of compulsory purchase which would enable it to ensure that it
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could make use of the reservation. Without the reservation being in the hands of a body having powers of compulsory purchase, a solution of deadlock could result, with nobody being able to carry out the redevelopment.
It looks, therefore, as if the right course might be for the Corporation to transfer its freehold interest in the leasehold houses to the urban district council, as, I believe, it has done in the case of those properties which are let by the council at a rack rent and which make up about half the population of the homes of Letchworth. Legislation would, I believe, be needed to achieve this effect, but I think that everybody agrees that whatever solution were adopted for Letchworth, some sort of amending private local Bill would be required to achieve the object.
I am merely putting forward the suggestion in the hope that it may prove a constructive one. As to what form that legislation might be, it would, of course, have to be drafted to meet the situation resulting from this Measure and deal with the case of tenants who had already served notice under the provisions of the Bill but in whose cases the freehold interest had not been transferred.
There is some time available, as I assume that the Letchworth Corporation most certainly, whoever else may or may not do so, will be likely to sponsor a scheme under Clause 19 in order to preserve the necessary machinery of control by covenants to maintain the character of the estate, and to provide for suitable monetary contributions by the enfranchised leaseholders to the amenity services which continue to be provided under such a scheme. If the Corporation were to do this it would give time to promote the necessary Private Bill legislation. I believe that by this means it would be possible for Letchworth to preserve both the entity of the town and the incremental value, as they term it there, for the community, while still granting enfranchisement to the leaseholders.
I have also received representations in the matter from the Bourneville Trust, which is a somewhat comparable body but with not quite precisely the same problems. I do not want to go into this in any detail, but if that Trust, on reflection were to consider that it would

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not receive sufficient protection under a Clause 19 scheme it might like to consider the possibility of doing something similar in the way of private legislation.
For the reasons I have indicated, Mr. Deputy Speaker, I must advise the House to disagree with the Lords Amendment.
Mr. Martin Maddan:We are grateful to the Minister for a concise and clear explanation of the purpose of this Lords Amendment and of why the Government do not accept it. That rejection is not entirely watertight. I feel that the Lords Amendment could provide the basis of a very satisfactory solution had it been the wish of the Government to accept it and, perhaps, make some slight amendment to it.
We have discussed the case of Letchworth in this House on Second Reading, in Committee, and to a certain degree on Report. When those of us who are interested in the realities of Letchworth now take into account the preservation of the character of the town and the interests of the ratepayers as a whole—who, not only the leaseholders, have taken on the burden of underwriting the compensation provisions determined only recently under the Letchworth Garden City Corporation Act—when we take into account all these things, we feel, though reluctantly, that in view of the opinion expressed by the Minister and in view of the advice that he and the Government Whips will no doubt give to his colleagues, we should do what we can to preserve the interests of the town of Letchworth and of its individual people, and in these circumstances go along the lines that he has suggested. Before leaving the matter like that, however, it is necessary and right to make one or two observations.
Dealing with the previous Amendment the Parliamentary Secretary very much emphasised that it would be wrong to separate tenants into different categories merely because the landlords were of one character or another. That is not the case in Letchworth where it is the tenants rather than the landlords who have the particular characteristic that they have the right and practice, if I may put it in a sort of shorthand form, to have leases renewed or extended without taking into account the value of the bricks and
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mortar they may have put on the land. Letchworth, therefore, is a unique case.
5.45 p.m.
The hon. and learned Gentleman said that a substantial body of these leaseholders in Letchworth want enfranchisement and, of course, there are some leaseholders who do want it. How substantial that body is is open to a great deal of question, because in the campaign that has gone on there has been misrepresentation of the facts of the case and of the policies and actions of the Corporation. There have been petitions and counter-petitions, and I am sure that, with their experience, hon. Members will not be surprised to hear that various citizens signed both in the confusion and argumentation that has gone on. We therefore have to give some weight to the fact that there are leaseholders who want to enfranchise, but we should not be taken away by the idea that this body of opinion is very substantial.
A further point is that the Bill as now drawn excludes houses of over £200 rateable value, or £400 in London. Tenants of such houses may not enfranchise themselves. If we are to drive a coach and horses through the principle of the Bill in this way, it seems very reasonable that there should be a little phaeton driven through it in respect of Letchworth. If there is to be private legislation, the necessary Bill, for reasons that the Minister has given, will have to be drawn up with speed, because if Parliament does not consider such a private Measure quickly there is a danger that the whole entity of Letchworth will disintegrate, and it will be no good coming along after that because it will be quite impossible then to turn the clock back.
The Minister's proposition, which is an interesting one, is that the freehold of the leasehold houses now belonging to Letchworth Garden City Corporation set up under the 1962 Act should be transferred to the urban district council. This is the first time I have thought about or heard of this proposition, but it may point which way. Nevertheless, at this hour on a Tuesday afternoon, at only one or two minutes' notice, I would not like to say that this is necessarily the best way, and certain questions come to my mind.

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When the 1962 Act was before Parliament, the sponsor, the urban district council itself, was very keen that the ownership of the freehold should be taken out of party politics; that it should not become a sort of football to be kicked about at every municipal election. The Corporation was therefore established to become the landlord, with the chairman and the three members to be appointed by the Minister, one member by the Hertfordshire County Council and one only by the urban district council. That was the urban district council's own proposal, because although it wanted a voice in the Corporation it did not want to fulfil the role of landlord.
The Minister's idea is a neat one, in that it fits in with legislation as we presume it will be enacted, but I am wondering whether it would be possible in those circumstances for it to become by custom, or formal agreement, the practice for the management of those leaseholds, although the freehold was actually vested in the urban district council, to reside with the corporation. I do not think that the leaseholders or the other ratepayers in the town—the people contributing to the rates whether they live in council houses or whether commercial or industrial property—would wish to see the freehold of the leasehold houses become subject to party political argumentation at election times and in the council chamber.
These are only preliminary observations on the Ministers' suggestion, which is an interesting one. I regret that he has not seen fit to go on the lines of the Lords Amendment, but on the ground that half a loaf is better than no bread, and that if the Letchworth Council is to promote a Private Bill we want it to do so in an atmosphere of as much unity in this House as possible, I do not want to dispute too much the principle of what the Minister said. We must, of course, have regard to the details and keep our eye on the objective, which is to preserve the entity of the town and to retain its incremental value for the benefit of the community as a whole.
The Minister has put forward this as an idea. I did not actually hear that he committed himself to supporting it, as he or one of his colleagues might be required to do if a Private Bill were to
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come before the House. We all know that the Government Front Bench attitude may be of great importance, to say nothing of the services of the Ministry. I hope that before we conclude the debate on this Amendment the Minister will be allowed to go a little further in clarifying these points.
Mr. S. C. Silkin: I had not intended to detain the House at all on this matter, particularly in view of the fact that my hon. and learned Friend the Minister,—whom I take the opportunity of congratulating on achieving his new office—has made such an overwhelming case in favour of excluding this Amendment and the hon. Member for Hove (Mr. Maddan) has not really sought to displace it, but I want to say a few words because of what was said in the last section of the speech of the hon. Member. I hope my hon. and learned Friend, even if he were able to do so, will not give any commitment as to future legislation. Clearly this is a matter which needs to be very carefully considered by all sections of the community in Letchworth, not merely the urban district council but the many people who have taken the view that it is right to include the lessees of the corporation within the provisions of this Bill.
No doubt quite unintentionally, the hon. Member for Hove expressed himself in a somewhat misleading way when he referred to the lessees of the Corporation of Letchworth as having the right to obtain an extension of their leases. They have no such right. Indeed that is the whole point which the Minister was making, as I understood, in his opening remarks on this Amendment. If they had not only the right, which they now enjoy, the lease having been extended, to hold their property at a modern ground rent, but also the right to have the leases extended, there would be a very different situation. They have not got that right. They can be turned out. My information is that on a number of occasions the existing occupier, the lessee, has been turned out of the property he has occupied in Letchworth.
The hon. Member spoke about misrepresentation, and I rather gathered that he was not confining his comments to one side or the other. Certainly some of the remarks that were made at the time when the Amendment was accepted

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in another place could well have given the general public the view that Letchworth was wholly united in wanting to be excluded from the Bill. This was expressly said by some. Therefore I think it only right to say what happened thereafter. Those who believe that Letchworth should be entitled to the benefit of the provisions of this Bill like every other community, having heard that said, approached me and said, "We do not think this is true. What should we do about it?" I said, "There is only one way of finding out. That is to go round canvassing house by house with a perfectly fair and open statement of what your intentions and wishes are and to ask people whether they are willing to sign that statement or not".
The Minister has the result of that canvass in his Ministry. I think it right that the figures should be known. According to the corporation, there are 2,632 leasehold properties which the corporation holds. No doubt some of those are not in the eligible category, being above £200 rateable value. No doubt some of the lessees would not be eligible by reason of length of residence as yet. One has to make allowances for these factors, but a house-to-house canvass over a relatively short period of time has produced the result that of those properties the occupants of 1,663 say they are in favour of Letchworth being included in the Bill. If my arithmetic is right, that is 63 per cent., which is a very much higher figure than is ever achieved in Letchworth local council elections.
This is a matter of considerable importance. It is right that it should be known, I applaud the fact that the citizens of Letchworth, or rather, the lessees at Letchworth, clearly take the same view ac my hon. and learned Friend in seeking the removal of this Amendment.
Mr. Maddan: I know that the hon. and learned Member for Dulwich (Mr. S. C. Silkin) will not want to rest too much on that, because he probably is also aware that many of those who signed the original petition then signed what we might call the counter-petition.
Mr. Silkin: I can only give the facts as I have given them. The number of people who signed this petition was 2,779 and each signature has been very carefully checked against the electoral register
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in order to ensure that there has been no duplication of any kind. The document which they have signed, which I have seen, makes it abundantly clear. Anyone who reads it knows what he is signing.
6.0 p.m.
Sir Lionel Heald: I support my hon. Friend the Member for Hove (Mr. Maddan). I am one of those who have for some years done all they can to help the Letchworth ideal when the matter has arisen in the House. I came here today with the idea that I should support the Lords in the Amendment, but, having listened to the Minister of State, I believe that his argument is clear and should be accepted. If it is, I hope that we can rely on his giving at any rate sympathetic consideration to the point of view advanced by my hon. Friend. We know that the hon. and learned Gentleman cannot give an undertaking today, but those of us who have had to deal with these matters know that, when difficult legislation of this kind involving private legislation becomes necessary, the attitude of the Department and of the Minister is of the highest importance.
I personally would be quite satisfied if we could feel that the Minister of State would give it sympathetic consideration. If I am not intruding improperly by suggesting it, I suggest that, if the Minister of State and my hon. Friend the Member for Hove got together, a good result would be obtained. From what I have heard, I am given to hope that perhaps it would be better if the hon. and learned Member for Dulwich (Mr. S. C. Silkin) were not to take part in that amicable effort. It is important that, if possible, we should enable a satisfactory arrangement to be arrived at in repaid to Letch-worth, having regard to its history. I therefore hope that we can be told by the Minister of State that the considerations put forward by my hon. Friend the Member for Hove will be given open-minded consideration.
Mr. Graham Page: The Amendment and the Government's opposition, yet sympathy, towards it put us in a rather curious position. The Letchworth Corporation is operating under a Statute. The Statute had exactly the same intentions as the Bill—the protection of the

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tenants on that estate and the relief of hardship at the end of leases. It provided that the Coporation should be entitled to re-let only at the value of the site, without regard to the value of the bricks and mortar on the site. This is a statutory management body, approved recently by the House.
In the Bill compensation is based upon the assumption that there is a fifty-year lease, an extended lease—that is, upon the assumption that the tenant has, without purchase, the full value of the house. The corollary to that is that, if the tenant is granted a fifty-year lease, he will have as good as a freehold. He will have something of which he can dispose at a price at which he might sell the freehold. Therefore, if there were some arrangement of this sort, as indeed there is in the statutory responsibilities of Letchworth, the tenants do not suffer if they are granted such an extended lease—a fifty-year lease or a 99-year lease.
Although it may be that on some occasions at Letchworth, for some reasons of development, a tenant has been asked to vacate at the end of his lease, I understand that in the great majority of cases the extended lease is granted, so the tenant suffers nothing under this provision, as compared with the tenant of any other landlord under the Bill. Nor, for that matter, will tenants of property held upon a similar trust.
The Minister of State called the attention of the House to that part of the Amendment which refers to bodies holding an estate on a trust similar to the statutory obligation under which Letchworth holds. The Amendment provides that this must be certified by the High Court to be a trust similar to the statutory obligations of—we have called it Letchworth, although Letchworth is not mentioned in the Amendment.
I would have liked to have seen the Amendment accepted. I offer my sincere congratulations to my hon. Friend the Member for Hove (Mr. Maddan) on his tenacity over this matter throughout the passage of the Bill. From Second Reading, through the Committee stage, through Report and Third Reading, he has put forward this case most cogently. It seems that perhaps he is now in sight of reward. He has been skilful in de-hybridis-
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ing the Amendment. [Laughter.] If the hon. and learned Gentleman can invent the word "hybridising", I am entitled to invent the word "de-hybridising". My hon. Friend managed to get the Amendment in order at each stage of the Bill.
If others were to take advantage, by the creation of trusts of this sort, of a general Amendment to the law, why not? I do not think that tenants would suffer, as compared with tenants under the Bill.
However, the Minister of State has suggested that this could be done by private legislation. I am still a little doubtful about what the suggestion is. The hon. and learned Gentleman made the strange statement that the estate can save itself by cutting its own throat, by selling or disposing of its property to the local authority. I do not see how it saves the Corporation to get rid of its property to the local authority. This just shows the extraordinary results of legislation of this sort, which we on this side have said all along was not properly thought out before its introduction.
Another strange suggestion made by the Minister of State was that the Letchworth Corporation should adopt the fiction of accepting a scheme under Clause 19 so as to hold matters up for a year and get the Bill in. [Interruption.] I am sorry if I misunderstood the Minister of State, but that is what it sounded like from this side. If this is a good suggestion, why on earth was not it made before? It is not as if my hon. Friend the Member for Hove has not put this forward many times. Over the past few months this proposition has been known to the House. The Government have known that the Letchworth Corporation was worthy of some particular consideration. Why has not this been proposed before so that the Corporation was able to prepare a Bill before 17th November?
Mr. S. C. Silkin: The hon. Gentleman should be fair to my right hon. Friend the former Minister, who said on many occasions that this was a matter for a Private Bill.
Mr. Page: Perhaps my recollection is at fault. If that was said by the former Minister, I withdraw what I have said. The suggestion was certainly not put forward in the form in which it is now put forward, which I understand to be

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some type of assurance from the Government that they will give a fair wind to private legislation of this sort. If it is legislation which enables this estate to continue to be managed and developed by this Corporation, and not just disposed of to the local authority—I do not believe that would do any good—that may be the right thing to do.
I repeat that I would have liked the Amendment to have been agreed to. After all, it was proposed from the Government benches. It was supported by hon. Members of all parties. I should have thought that it was an Amendment worthy of being agreed to. We are now told that this must all be done by private legislation. Provided that we can have an assurance that the Government will give a fair wind to such private legislation and that it will be legislation which will enable the Corporation to continue in office, we on this side would not press the Amendment but will hope that the matter will be dealt with in private legislation.
Mr. MacDermot: Mr. Speaker, I ask leave to speak again. I am grateful to hon. Members on both sides for their reception of the suggestion which I have made as to how this matter might be dealt with. It is correct, as my hon. and learned Friend the Member for Dulwich (Mr. S. C. Silkin) said in his intervention, that it was made clear, both in Standing Committee by my hon. Friend the Parliamentary Secretary and my noble Friend the Parliamentary Secretary in the other House before the Recess, that this was a matter which could and should be dealt with by private legislation. The proposal which I have put forward today, I wish to make clear, is purely a personal proposal of my own as a result of the discussions which I have had with quite a large number of people in recent weeks about this problem. I saw the hon. Member for Hove (Mr. Maddan). I also had a useful discussion with my hon. Friend the Minister of State who is the Member of Parliament for the area concerned, the hon. Member for Hitchin (Mrs. Shirley Williams) who, by reason of her office, is somewhat silenced but who I know takes a keen interest in this matter and has been very helpful to me. I am very glad to see her here during this debate.
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I have also discussed the problem with representatives of both the two sides in the recent dispute—if that is the right word to use—about the question of enfranchisement in Letchworth. I have put forward the suggestion that I have in the hope and belief that we may end the somewhat divisive effect which this Bill has so far had upon Letchworth and restore the unity which I am sure everyone would agree is in the best interests of Letchworth Garden City.
If I can seek to make clearer the points that I have not made clear enough in my proposal, firstly I am not suggesting—it is entirely a matter for Letchworth—that I see any reason why Letchworth Corporation should cease or should destroy itself, as the hon. Member put it. I am merely suggesting that the freehold of the land should be transferred to the council. After all, this has already been done in respect of a large part of the estate, namely, the part where there are rack rent tenants. This has not destroyed either the unity or the character of the estate. If it was agreed between the corporation, the council and the citizens of Letchworth that that was the best solution, I see no reason why the corporation should not continue to manage the estate, I suppose legally acting as agents for the council but continuing in practice to manage, as it has done, hitherto.
My reference to Clause 19 was not to suggest that an application should be made as a fiction in order to gain time, assuming that enfranchisement does take place. I would imagine that it would be necessary for Letchworth to have a Clause 19 scheme. Apart from anything else, I see no other way by which the enfranchised leaseholders would contribute, as I imagine they would all agree they should do in the future, to the cost of the common amenities from which they will continue to derive benefit. That can be provided for under the Clause 19 scheme. I was assuming that, on any basis, there would be such an application. I was merely pointing out that because of the standstill effect of such an application, there would be some time. The suggestion I made was not one which would be defeated immediately by an application taken by the

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leaseholders the moment the Bill came into effect.
I turn, therefore, to the questions that I was asked as to the Government's position. Of course, there can be no question of Government initiative in this matter. The initiative must come from Letchworth, and no one is committed to the proposal that I have put forward, as I said, personally in my own name. None of the people I have seen are committed to it. From the conversations I have had with some of them, it is my belief that it might prove a basis for agreement, and I hope it will.
Naturally, if it does, I shall continue to give it as good a wind as I can and such help as I can, and I may say that I would not have put it forward to the House today if, on the first consideration of it that has been possible within the Department, it was thought by the Department that there were any inherent obstacles to the solution on these lines. If I can personally be of any assistance in the matter I shall be very glad to be so. I cannot commit the Government in advance, but I can offer my own personal good will in the matter and I certaintly do that.
Question put and agreed to.

Clause 3.—(MEANING OF "LONG TENANCY".)
Lords Amendment No. 4, in page 4, line 26, leave out "twenty-one" and insert "fifty".
The Minister of State, Welsh Office (Mrs. Eirene White): I beg to move, That this House doth disagree with the Lords in the said Amendment.
I think it might be convenient if with this Amendment we take Amendments Nos. 6 and 10 which are in identical terms, in page 5, lines 7 and 14. They all deal with the same point.
Mr. Speaker: Not Amendment No. 8?
Mrs. White: It has been suggested that Amendment No. 8 might come more comfortably with Amendments Nos. 5, 7 and 9.
Mr. Speaker: The hon. Lady has pro-posed that Nos. 4, 6 and 10 should be taken together. I have no objection if that is the will of the House.
Mr. Graham Page: Like you, Mr. Speaker, I thought that Amendment No. 8 would come with these Amendments rather than with Nos. 5, 7 and 9.
Mrs. White: If I might put the difficulty in which we are placed, Mr. Speaker, I think that there is a later point at which I have to move an Amendment to No. 8, which is not at this moment. I consulted the Table about this, and I was told that the Amendment to Amendment No. 8 which brings in the period of 21 years should be moved at a later point.
Mr. Speaker: I do not think we should make heavy weather about this. It is just a matter of convenience. We will take Nos. 4, 6 and 10 together, as the hon. Lady suggests.
Mrs. White: Thank you, Mr. Speaker.
The point on which we ask the House to disagree with their Lordships is that they are attempting to insert a term of 50 years for the main provisions of the Bill instead of the term of 21 years. This is not the first time that this

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attempt has been made. When we previously discussed the matter in Committee and on Report, it was first of all suggested that the term should be 90 years and then 50 years. We have really rehearsed all the arguments at length. I would find it rather difficult to say anything fresh. I frankly doubt whether other hon. Members will be able to say anything new either, although I know that they may try.
This is one of the basic disagreements between us, but we have been able to ground our propositions firmly on precedent, which we would have supposed would appeal to the Opposition with their regard for tradition. In fact, we can go back to the Places of Worship (Enfranchisement) Act, 1920, which has the term of 21 years; the Law of Property Act on which I am told Lord Birkenhead made a powerful speech on this matter; and far more recently and perhaps more cogently because it will be within the direct experience of a number of hon. Members, we have the 1954 Landlord and Tenant Act which was the product of the party opposite. I served during the Committee stage of that Measure. The arguments there were all in favour of taking 21 years as the dividing line between a short and a long lease.
We appreciate that hon. Members opposite hold a different view on the question, but we believe that, for practical advantages, we should stick to the division between short and long leases which they themselves adopted in their 1954 Act. I do not imagine that we should gain very much in wisdom if we went again into the arguments which have been generously rehearsed at all stages and in both Houses. I hope, therefore, that the House will disagree with their Lordships in these Amendments.
Mr. Hugh Rossi: The discussions both here and in another place on how long is a long lease recall to my mind a film which I saw many years ago in which a rather improbable schoolmaster by the name of Will Hay was involved with an impossible schoolboy named William Moffat in a never-ending dialogue about how long was a piece of string.
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The Government have been at great pains throughout to prove that their piece of string is at least 21 years long. If one compares a 21-year lease with a lease for one year, three years, or even for five or seven years, it can be said that 21 years is a long lease. However, if one compares a 21-year lease with a lease for 99 years, the normal ground rent lease with which the Bill was originally concerned, or a lease for 999 years, it is seen to be by no means long. When one compares it with a freehold, the largest interest which can be owned in land, which lawyers call a fee simple absolute—absolute, that is, in time—one is comparing 21 years with infinity. In these circumstances, how can one say that 21 years is "long", when we are giving, or seeking to give, the owner of that interest the right to acquire an interest which continues in infinity?
The Government have overlooked that, in the apparently absurd conundrum about Will Hay's piece of string, there lies a truth of logic, that "long" is a relative term. Hence, a 21-year lease may be a long lease for some purposes but not for others.
The right hon. Lady has reproduced the argument which we heard in Committee and on Report, and which was heard in another place, that a 21-year lease is termed a long lease by reference to precedent. We have been referred to the 1920 Act and the 1954 Act. But for what purposes was a 21-year lease considered long in that context? Secondly, if it was long in that context, is it necessarily long in the context with which we are here concerned? Following precedent slavishly in this way, without realising that "long" is a relative term, the Government have led themselves into an absurd situation.
In the 1920 Rent Act, Parliament was concerned to deal with a certain situation and to give security of tenure to occupiers or tenants of residential premises who faced eviction at the termination of their interests in social conditions which made it well nigh impossible for them to acquire other accommodation on equal terms. It was thought necessary to give protection to tenants in that position. But it was felt at that time that tenants of 21-year leases did not require that particular protection, possibly because 21 years was sufficiently long for most residential purposes and for the purpose of

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keeping a pool of housing available, possibly because leases for 21 years were given normally for the quality and expensive type of property of which there was no shortage, possibly because it was felt in 1920 that in 21 years social conditions might well have changed and emergency legislation—Rent Act legislation is emergency legislation—then being brought in would no longer apply. For these reasons, 21-year leases, then in the Act for the purposes of definition called long leases, were excluded. It was done for those reasons and for no other.
In 1954, the Government of the day felt that leases which were excluded by the earlier Act of 1920 needed some form of protection, and they referred to long leases, going back to the 1920 definition, in saying what was the subject matter of the 1954 Act.
Leases for 21 years or more were called long leases for specific purposes, and these purposes do not apply here. We are considering other matters entirely. We are considering the right of the owner of a limited interest in land to acquire the absolute interest in land. If one looks at the White Paper, the position in which the Government put themselves is seen patently to be even more absurd. The whole basis of this legislation is that the land belongs to the freeholder and the buildings belong to the leaseholder. But how can this be said in regard to a term as short as 21 years? How can the Government say that, when the freeholder and the leaseholder originally entered into the arrangement between them, they thought that the leaseholder would be acquiring the building for the remainder of its useful life? What tenant would have entered into a 21-year lease—this is the kernel of the matter—on the basis that he was paying for the building, paying a premium sufficiently large to justify his acquiring the building, or, still less, entering into a building lease? What tenant would have entered into a lease for 21 years, covenanting to put a building upon the land? Clearly, it cannot be right. If one adopts the Government's premise, that the land belongs to the freeholder and the building belongs to the leaseholder, one cannot apply it to a 21-year lease.
The position becomes even more absurd in relation to the extension Clauses of the Bill. We now say that the owner of
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a 21-year lease can turn it into a 50-year lease. This is patently absurd, and it has never been within the contemplation of the leasehold reformers through the past decades. Their problem was the lease for 99 years and more. This has been the problem with which all leasehold reformers have been concerned. Yet the Government now make complete nonsense of the situation.
In Committee, my right hon. and hon. Friends proposed that the correct definition for a long lease was one of 90 years. I did not agree with that view, but someone has to draw the line somewhere. The definition is to be found in our Income Tax laws. The Income Tax authorities have for many years regarded leases of 50 years or more as long leases.
6.30 p.m.
Where a premium has been paid on the creation of a lease of less than 50 years, Income Tax is not payable on the capital sum because it is regarded as payment of the rent in advance. Precise thought was given to the nature of the arrangement between the landlord and the tenant, to the question of who was paying for the building, and whether the tax should fall on the capital sum—whether it represented a payment for the building or merely an advance payment of rent. The Inland Revenue authorities concluded that from the very nature of the transaction a lease of 50 years or more was a long lease and that with a shorter lease the tenant had no interest whatever in the building.
Even at this late stage I ask the Minister to consider the absurd situation in which the Government are placing themselves by defining a long lease as one of 21 years. On the basis of their own premise for enfranchisement—the question of who owns the building and who owns the land—their position is complete nonsense. It is also nonsense for the other reasons I have given and for those which prompted their noble Lordships to amend the Bill as they did.
Mr. David Mitchell: I am particularly glad that the new Minister has joined us during this debate, because of his considerable experience in financial matters at the Treasury. I very much hope that he will reply to the debate, because one aspect concerns the Treasury and I hope that he will give the House his advice on it.

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The Government have invented the principle that the land belongs to the landlord and the bricks and mortar to the tenant. But if we accept that premise, surely it does not apply to a lease as short as 22 years, as proposed in the Bill? The Lords Amendment seeks to increase the period to 50 years. I particularly draw the attention of the ex-Financial Secretary to the Treasury to leases granted for a premium, which are not long leases in the ordinary meaning of the word, but fall within the scope of the Bill as it is now drafted.
I have in mind particularly the case where somebody has done nothing more nor less than to pay the ordinary rack rent in advance in a lump sum, which is very often to the advantage of the tenant as well as the landlord. I could give examples where the landlord and tenant have discussed a new lease and the landlord has asked, "Would you rather have a running rent or pay a premium and your rent in advance in a lump sum?" Because he pays less in total by paying in advance, the tenant often chooses to do so. He is then secure in old age and there will be no alteration in the rent with rising costs and so on.
It can be seen that there are many advantages to the tenant. This is recognised in the Income Tax Acts, which state that a premium paid on a lease of under 50 years shall be treated as income in the hands of the landlord. If it is so treated in the Income Tax laws, how can it be different under this legislation? If it is nothing but rent in advance, how can one say that the bricks and mortar belong to the tenant? He has not bought them any more than I have bought a house if I rent it for seven or 10 years.
The Minister must recognise that that argument is entirely logical. In our financial debates he has given us clear, concise and logical answers to the many questions put to him and I hope that he will give us his advice now. But I doubt whether he can find ways to defend what was put in the Bill by his colleague, the ex-Minister, who no longer steers it through the House. It is the most extraordinary basis of legislation.
I consulted one of the leading estate agents and valuers in the South of England on the question of whether premium
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leases are of major importance. He thinks that about 45 per cent. of the leases granted in London and the Home Counties in the past 25 years have been in the form of a premium and rack rent paid in advance. If that is so, we are dealing with a substantial number of people who will be put in a position which they never dreamt of being in when they took the lease and paid the rent in advance for 22 or 30 years. They will suddenly find that they are being made a gift of three-quarters of the value of the property, which they never intended to get and was not a basis of the contract at the start.
This is a matter of grave importance to the House, for a mark of a free society is that people are protected by law from other citizens acquiring their property except on fair and proper terms of compensation. This legislation operates against the sense of decency and fair play. The whole basis of contracts entered into for 25 years will be upset by the legislation, which will enable one private citizen compulsorily to purchase another's property for less than the fair market value.
I represent Basingstoke, which is an expanding town. An immense amount of compulsory purchase of other people's property—not by one citizen, but by the community—is involved in that expansion. There are many places where one desperately would not wish to see the compulsory purchases go through for personal reasons, such as where elderly people are involved. That is bad enough, but why will the Bill enable a private citizen compulsorily to purchase on unfair terms? We had a tragedy in Basingstoke, about which many local people are very worried—the case of an elderly man for whom the terms of compensation were so unfair that he committed suicide.
Mr. Speaker: Order. With respect, the hon. Member is getting away from the Lords Amendment.
Mr. Mitchell: I entirely accept your Ruling, Mr. Speaker. I was trying to show that immense personal hardship is created where there are unfair terms of compensation. Unless the Lords Amendment is accepted there is a grave danger of the House enacting that one citizen can compulsorily purchase another's property for unfair compensation, and that is what I believe is so deplorable.

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I sincerely hope that we have the benefit of the advice of the ex-Financial Secretary to the Treasury in this matter. I am sure that he cannot defend applying one law at the Treasury for Income Tax and another for the citizen, in the way that we see in the Bill.
Mr. Costain: The case has been made so well by my hon. Friends the Members for Hornsey (Mr. Rossi) and Basingstoke (Mr. David Mitchell) that I shall narrowly restrict my remarks. I wish to emphasise particularly the question of the people concerned with 21-year leases. Many people accept the principle that if a person puts a house on land he has some right to it, but people do not put it on land on a 21-year lease.
How the Government have arrived at the figure of 21 we do not understand. When I learned of the appointment of the new Minister I rejoiced to think that we should get some sense into this legislation. All through the Finance Bill my hon. Friends have made the point about the 50 years. I would remind the hon. and learned Gentleman of another period of 50 years, when we debated the Capital Gains Tax. Does he recall that 50 years was then accepted as a long asset?
Why do we have a different term for a long-term asset and a short-term asset in every Bill which comes before the House? We do not expect much consistency from the present Government on policy, but they ought at least to make it simple from the point of view of administration. Perhaps we may have clearly explained why 21 years has been chosen. It is normally after 21 years that a person becomes of age, but there is no question here of a house becoming of age. Why do not the Government adopt the 50-year period accepted in the Finance Bill?
Mr. Graham Page: If the Lords Amendment is rejected it means that a tenant with a lease for 21 years and one day has a right to acquire the freehold of the house in which he lives, the bricks and mortar, for nothing, and that is ridiculous. It blows up the Government White Paper on leasehold reform and blows up the Government's theories and philosophies about the tenant having built the house, as my hon. Friends the
1564
Members for Hornsey (Mr. Rossi) and Basingstoke (Mr. David Mitchell) have so clearly said.
"Long lease" or "short lease" or "ground lease" is not a lawyer's term now. If one asks any layman what he thinks is a ground lease he will say that it is one for 99 years. He would not think that a 21-year lease was a ground lease.
Mr. MacDermot: What about the 1954 Act?
Mr. Page: I will come to the 1954 Act in a moment as the hon. and learned Gentleman has commented on it. We compromised with the Government on this and put forward 50 years instead of 99 years, and this is well supported by Income Tax law and even by the Bill itself. The Bill recognises that the tenant should be given an extended lease of 50 years. The tenant is being given a long lease if he likes instead of his freehold. Why not offer him 21 years and say "There is your long lease."? The Bill has recognised that a long lease is one of 50 years, and we accepted that in the earlier stages, and that was inserted in the Bill in another place.
I challenge the Government to say where in the country there is an unrenewable ground lease for 21 years. I know that leases are granted in South Wales for 21 years, but they are renewable leases. I know of no unrenewable, properly called, ground lease for 21 years. The difficulty is coupled with the definition of low rent in a later Clause, and together with that it will certainly bring within the net some, and perhaps many, houses which were let at a market rent 21 years ago.
My hon. Friend the Member for Basingstoke also showed how it will bring within the net premium leases over 21 years. These leases of just over 21 years granted for a premium were transactions properly made to escape the Rent Act. It was perfectly permissible by law—until this Bill becomes law—for that to be done. It was done to escape the premium prohibition for controlled or regulated property. So there will be many cases in which merely because the landlord and the tenant arranged their affairs within the law so that a premium was paid and then a rack rent will now find

1565
that it will be turned into a ground lease and the tenant will be entitled to have his bricks and mortar without payment. I cannot see the Government's intention. What is behind it? Do they want to stop avoidance of the Rent Acts? That is not necessary. It is done in a later Clause in the Bill. There seems to be no purpose in this if the Government still hold to the principles set forth in the White Paper.
Just now the Minister interrupted, "What about the 1954 Act?" My hon. Friend the Member for Hornsey showed clearly that the 1954 Act was for the purpose of rent restriction and control and that it was repeating the 1920 provisions. The purpose was wholly different. The purpose of the 1954 Act was to let a tenant remain in the property at a rack rent. The purpose of the 1954 Act was not to give him the house for no payment at all. So the position is wholly different.
It seems pure obstinacy on the part of the Government to hold to the period of 21 years when they have put before the House no reason at all within their principles of leasehold enfranchisement why they should define a long lease as being one over 21 years.
6.45 p.m.
Mrs. White: We have had an interesting and pleasant debate, and, particularly an amusing illustration was given by the hon. Member for Hornsey (Mr. Rossi) about the length of a piece of string.
But I do not think that my expectations have been falsified. I said at the outset that I doubted whether we should tonight hear any arguments different in substance from those previously rehearsed. This is a matter on which we are simply at variance.
Various arguments have been put forward, but I do not think that on this occasion we ought to debate the 1920 Act or the 1954 Act. We have enough to do to try to get this Bill through. Therefore, I do not feel disposed to follow the very interesting historical points adduced by the hon. Member for Hornsey.
Nor do I think we ought to re-debate the various Finance Bills dealing with the Income Tax law on this matter. I
1566
think that there were good reasons at one time which made the Revenue think that 50 years would be useful from its point of view. That was before the Capital Gains Tax. I do not think that this is the moment to go into all the arguments about Income Tax.
Mr. Graham Page: Why not?
Mrs. White: Because we are discussing something else. I think that we could go on chopping logic and ill logic about this, but I do not feel that we add very much to the store of wisdom by so doing.
I would remind the hon. Member for Basingstoke (Mr. David Mitchell), who was eloquent about premium leases, that there are other restrictions in the Bill which very much limit the number of those premium leases which could be brought within the scope of the Bill. For example, the restoration of the rateable value, in the carrying out of which I had some hand at an earlier stage, has a limiting effect for reasons that I gave then which I thought were conclusive.
We appreciate that the Opposition do not agree with us on this. They have their views and we have ours. I do not feel that we should get any clearer point than we did at the beginning if we went into the matter any further.
Mr. David Mitchell: Will the hon. Lady give way?
Mrs. White: I do not want to enter into further arguments because I think that we have already shown conclusively that we wish to disagree with the Lords on this point.
Mr. David Mitchell: It is the most extraordinary thing that I have ever heard in the House for the Minister to say, "I do not agree with the hon. Member, but I am not going to tell him why and not give him the basis of my argument because I do not think that this is the time and place to do so. "If this is not the time and place to answer the arguments which have been brought forward, where is the right time and place?
Question put, That this House doth disagree with the Lords in the said Amendment:—
The House divided: Ayes 175, Noes 96.

Division No. 491.]

AYES

[5.22 p.m.

Allaun, Frank (Salford, E.)

Atkinson, Norman (Tottenham)

Binns, John

Alldritt, Walter

Bacon, Rt. Hn. Alice

Bishop, E. S.

Allen, Scholefield

Bagier, Gordon A. T.

Blackburn, F.

Anderson, Donald

Barnett, Joel

Boardman, H.

Archer, Peter

Beaney, Alan

Booth, Albert

Atkins, Ronald (Preston, N.)

Bidwell, Sydney

Boston, Terence

Bottomley, Rt. Hn. Arthur

Hooson, Emlyn

Parker, John (Dagenham)

Braddock, Mrs. E. M.

Horner, John

Parkyn, Brian (Bedford)

Brooks, Edwin

Houghton, Rt. Hn. Douglas

Pavitt, Laurence

Brown, Bob (N'c'tle-upon-Tyne, W.)

Howarth, Harry (Wellingborough)

Pearson, Arthur (Pontypridd)

Buchan, Norman

Howarth, Robert (Bolton, E.)

Perry, Ernest G. (Battersea, S.)

Buchanan, Richard (G'gow, Sp'burn)

Howie, W.

Perry, George H. (Nottingham, S.)

Cant, R. B.

Hoy, James

Prentice, Rt. Hn. R. E.

Carter-Jones, Lewis

Huckfield, Leslie

Price, Thomas (Westhoughton)

Coe, Denis

Hughes, Hector (Aberdeen, N.)

Price, William (Rugby)

Coleman, Donald

Hunter, Adam

Probert, Arthur

Conlan, Bernard

Hynd, John

Rankin, John

Corbet, Mrs. Freda

Jackson, Colin (B'h'se & Spenb'gh)

Rhodes, Geoffrey

Craddock, George (Bradford, S.)

Jackson, Peter M. (High Peak)

Robinson, W. O. J. (Walth'stow, E.)

Crawshaw, Richard

Janner, Sir Barnett

Rogers, George (Kensington, N.)

Crosland, Rt. Hn. Anthony

Jeger, George (Coole)

Rowlands, E. (Cardiff, N.)

Crossman, Rt. Hn. Richard

Jenkins, Hugh (Putney)

Ryan, John

Cullen, Mrs. Alice

Johnson, Carol (Lewisham, S.)

Shaw, Arnold (Ilford, S.)

Dalyell, Tam

Jones, Dan (Burnley)

Sheldon, Robert

Davidson, Arthur (Accrington)

Jones, J. Idwal (Wrexham)

Shinwell, Rt. Hn. E.

Davies, Dr. Ernest (Stretford)

Jones, T. Alec (Rhondda, West)

Short, Mrs. Renée (W'hampton, N.E.)

Davies, G. Elfed (Rhondda, E.)

Kerr, Dr. David (W'worth, Central)

Silkin, Rt. Hn. John (Deptford)

Davies, Harold (Leek)

Kerr, Russell (Feltham)

Silkin, Hn. S. C. (Dulwich)

Davies, Ifor (Gower)

Leadbitter, Ted

Silverman, Julius (Aston)

Davies, S. O. (Merthyr)

Ledger, Ron

Silverman, Sydney (Neison)

Dempsey, James

Lee, John (Reading)

Skeffington, Arthur

Dewar, Donald

Lestor, Miss Joan

Slater, Joseph

Diamond, Rt. Hn. John

Lewis, Arthur (W. Ham, N.)

Small, William

Dickens, James

Lewis, Ron (Carlisle)

Snow, Julian

Dobson, Ray

Lipton, Marcus

Spriggs, Leslie

Doig, Peter

Lubbock, Eric

Strauss, Rt. Hn. G. R.

Dunnett, Jack

Lyons, Edward (Bradford, E.)

Summerskill, Hn. Dr. Shirley

Dunwoody, Mrs. Gwyneth (Exeter)

MacDermot, Niall

Swain, Thomas

Dunwoody, Dr. John (F'th & C'b'e)

Macdonald, A. H.

Symonds, J. B.

Edelman, Maurice

McGuire, Michael

Thorpe, Rt. Hn. Jeremy

Edwards, Rt. Hn. Ness (Caerphilly)

Mackenzie, Alasdair (Ross & Crom'ty)

Tinn, James

Edwards, William (Merioneth)

Mackie, John

Tornney, Frank

Ellis, John

Mackintosh, John P.

Urwin, T. W.

Ensor, David

Maclennan, Robert

Varley, Eric G.

Finch, Harold

McMillan, Tom (Glasgow, C.)

Wainwright, Edwin (Dearne Valley)

Fitch, Alan (Wigan)

Mahon, Peter (Preston, S.)

Wainwright, Richard (Colne Valley)

Fletcher, Ted (Darlington)

Mallalieu, E. L. (Brigg)

Walden, Brian (All Saints)

Foot, Michael (Ebbw Vale)

Mallalieu, J. P. W. (Huddersfield, E.)

Wallace, George

Ford, Ben

Manuel, Archie

Watkins, Tudor (Brecon & Radnor)

Fowler, Gerry

Mapp, Charles

Weitzman, David

Freeson, Reginald

Marquand, David

Wellbeloved, James

Galpern, Sir Myer

Mayhew, Christopher

Whitaker, Ben

Gardner, Tony

Mendelson, J. J.

White, Mrs. Eirene

Garrett, W. E.

Miller, Dr. M. S.

Wilkins, W. A.

Gourlay, Harry

Milne, Edward (Blyth)

Willey, Rt. Hn. Frederick

Gregory, Arnold

Mitchell, R. C. (S'th'pton, Test)

Williams, Alan (Swansea, W.)

Grey, Charles (Durham)

Molloy, William

Williams, Clifford (Abertillery)

Griffiths, David (Rother Valley)

Morgan, Elystan (Cardiganshire)

Williams, Mrs. Shirley (Hitchin)

Griffiths, Rt. Hn. James (Llanelly)

Morris, Alfred (Wythenshawe)

Willis, George (Edinburgh, E.)

Griffiths, Will (Exchange)

Morris, Charles R. (Openshaw)

Wilson, Rt. Hn. Harold (Huyton)

Grimond, Rt. Hn. J.

Neal, Harold

Wilson, William (Coventry, S.)

Hale, Leslie (Oldham, W.)

Noel-Baker, Francis (Swindon)

Winnick, David

Hamilton, James (Bothwell)

O'Malley, Brian

Winstanley, Dr. M. P.

Hamilton, William (Fife, W.)

Orme, Stanley

Winterbottom, R. E.

Hamling, William

Oswald, Thomas

Woodburn, Rt. Hn. A.

Hannan, William

Owen, Will (Morpeth)

Woof, Robert

Harper, Joseph

Padley, Walter

Yates, Victor

Harrison, Walter (Wakefield)

Page, Derek (King's Lynn)

Haseldine, Norman

Pannell, Rt. Hn. Charles

TELLERS FOR THE AYES:

Hilton, W. S.

Park, Trevor

Mr. Neil McBride and

Mr. Ioan L. Evans.

NOES

Allason, James (Hernel Hempstead)

Cordle, John

Foster, Sir John

Astor, John

Costain, A. P.

Gibson-Watt, David

Awdry, Daniel

Craddock, Sir Beresford (Spelthorne)

Goodhew, Victor

Balniel, Lord

Cunningham, Sir Knox

Grant-Ferris, R.

Bennett, Dr. Reginald (Gos. & Fhm)

Dalkeith, Earl of

Gresham Cooke, R.

Birch, Rt. Hn. Nigel

Dance, James

Grieve, Percy

Blaker, Peter

d'Avigdor-Goldsmid, Sir Henry

Griffiths, Eldon (Bury St. Edmunds)

Brinton, Sir Tatton

Digby, Simon Wingfield

Gurden, Harold

Bromley-Davenport, Lt.-Col. Sir Walter

Doughty, Charles

Hall-Davis, A. G. F.

Brown, Sir Edward (Bath)

Eden, Sir John

Harris, Frederic (Croydon, N. W.)

Bruce-Cardyne, J.

Elliot, Capt. Walter (Carshalton)

Harris, Reader (Heston)

Bullus, Sir Eric

Elliott, R. W. (N'c'tle-upon-Tyne, N.)

Harrison, Brian (Maldon)

Campbell, Gordon

Errington, Sir Eric

Harrison, Col. Sir Harwood (Eye)

Channon, H. P. G.

Farr, John

Hawkins, Paul

Cooke, Robert

Fletcher-Cooke, Charles

Hay, John

Cooper-Key, Sir Neill

Fortescue, Tim

Heald, Rt. Hn. Sir Lionel

1540

1541

Heath, Art. Hn. Edward

Maude, Angus

Rippon, Rt. Hn. Geoffrey

Heseltine, Michael

Maxwell-Hyslop, R. J.

Rodgers, Sir John (Sevenoaks)

Hiley, Joseph

Maydon, Lt.-Cmdr. S. L. C.

Royle, Anthony

Hobson, Rt. Hn. Sir John

Mills, Peter (Torrington)

Russell, Sir Ronald

Holland, Philip

Mills, Stratton (Belfast, N.)

Shaw, Michael (Sc'b'gh & Whitby)

Hordern, Peter

Miscampbell, Norman

Silvester, Fred (Walthamstow, W.)

Hornby, Richard

Monro, Hector

Smith, John

Howell, David (Guildford)

Montgomery, Fergus

Stodart, Anthony

Hunt, John

More, Jasper

Summers, Sir Spencer

Hutchison, Michael Clark

Morrison, Charles (Devizes)

Tapsell, Peter

Iremonger, T. L.

Mott-Radclyffe, Sir Charles

Taylor, Edward M. (G'gow, Cathcart)

Irvine, Bryant Godman (Rye)

Munro-Lucas-Tooth, Sir Hugh

Taylor, Frank (Moss Side)

Jennings, J. C. (Burton)

Murton, Oscar

Thatcher, Mrs. Margaret

Jones, Arthur (Northants, S.)

Nabarro, Sir Gerald

Turton, Rt. Hn. R. H.

Jopling, Michael

Orr-Ewing, Sir Ian

van Straubenzee, W. R.

Kershaw, Anthony

Osborne, Sir Cyril (Louth)

Walker-Smith, Rt. Hn. Sir Derek

Kimball, Marcus

Page, Graham (Crosby)

Wall, Patrick

Kitson, Timothy

Page, John (Harrow, W.)

Weatherill, Bernard

Lancaster, Col. C. G.

Pearson, Sir Frank (Clitheroe)

Webster, David

Lane, David

Peyton, John

Whitelaw, Rt. Hn. William

Legge-Bourke, Sir Harry

Pink, R. Bonner

Wills, Sir Gerald (Bridgwater)

Lloyd, Ian (P'tsm'th, Langstone)

Pounder, Rafton

Wilson, Geoffrey (Truro)

Lloyd, Rt. Hn. Selwyn (Wirral)

Price, David (Eastleigh)

Worsley, Marcus

Loveys, W. H.

Prior, J. M. L.

Younger, Hn. George

McMaster, Stanley

Pym, Francis

Maddan, Martin

Quennell, Miss J. M.

TELLERS FOR THE NOES:

Maginnis, John E.

Renton, Rt. Hn. Sir David

Mr. David Mitchell and

Mr. Anthony Grant.

Division No. 492.]

AYES

[6.50 p.m.

Allaun, Frank (Salford, E.)

Gourlay, Harry

Padley, Walter

Alldritt, Walter

Gregory, Arnold

Page, Derek (King's Lynn)

Allen., Scholefield

Grey, Charles (Durham)

Pannell, Rt. Hn. Charles

Anderson, Donald

Griffiths, David (Rother Valley)

Park, Trevor

Archer, Peter

Griffiths, Rt. Hn. James (Llanelly)

Parker, John (Dagenham)

Atkins, Ronald (Preston, N.)

Griffiths, Will (Exchange)

Parkyn, Brian (Bedford)

Atkinson, Norman (Tottenham)

Hale, Leslie (Oldham, W.)

Pavitt, Laurence

Bacon, Rt. Hn. Alice

Hamilton, James (Bothwell)

Pearson, Arthur (Pontypridd)

Beaney, Alan

Hamling, William

Pentland, Norman

Bidwell, Sydney

Harper, Joseph

Perry, George H. (Nottingham, S.)

Binns, John

Harrison, Walter (Wakefield)

Price, Thomas (Westhoughton)

Blackburn, F.

Haseldine, Norman

Price, William (Rugby)

Booth, Albert

Hilton, W. S.

Probert, Arthur

Boston, Terence

Hooson, Emlyn

Rhodes, Geoffrey

Bottomley, Rt. Hn. Arthur

Horner, John

Robinson, W. 0. J. (Walth'stow, E.)

Braddock, Mrs. E. M.

Houghton, Rt. Hn. Douglas

Rogers, George (Kensington, N.)

Brooks, Edwin

Howarth, Harry (Wellingborough)

Rowlands, E. (Cardiff, N.)

Brown, Bob (N'c'tle-upon-Tyne, W.)

Howarth, Robert (Bolton, E.)

Ryan, John

Buchan, Norman

Huckfield, Leslie

Shaw, Arnold (Ilford, S.)

Buchanan, Richard (G'gow, Sp'burn)

Hughes, Emrys (Ayrshire, S.)

Sheldon, Robert

Cant, R. B.

Hughes, Hector (Aberdeen, N.)

Shinwell, Rt. Hn. E.

Carter-Jones, Lewis

Hughes, Roy (Newport)

Short, Mrs. Renée (W'hampton, N. E.)

Chapman, Donald

Hunter, Adam

Silkin, Rt. Hn. John (Deptford)

Coe, Denis

Jackson, Peter M. (High Peak)

Silkin, Hn. S. C. (Dulwich)

Coleman, Donald

Janner, Sir Barnett

Silverman, Julius (Aston)

Conlan, Bernard

Jeger, Mrs. Lena (H'b'n&st.P'cras, S.)

Silverman, Sydney (Nelson)

Corbet, Mrs. Freda

Johnson, Carol (Lewisham, S.)

Skeffington, Arthur

Craddock, George (Bradford, S.)

Jones, Dan (Burnley)

Slater, Joseph

Crawshaw, Richard

Jones, J. Idwal (Wrexham)

Small, William

Crosland, Rt. Hn. Anthony

Jones, T. Alec (Rhondda, West)

Spriggs, Leslie

Crossman, Rt. Hn. Richard

Kerr, Russell (Feltham)

Summerskill, Hn. Dr. Shirley

Cullen, Mrs. Alice

Leadbitter, Ted

Swain, Thomas

Dalyell, Tam

Lestor, Miss Joan

Symonds, J. B.

Davidson, Arthur (Accrington)

Lipton, Marcus

Tinn, James

Davies, Dr. Ernest (Stretford)

Loughlin, Charles

Tomney, Frank

Davies, G. Elfed (Rhondda, E.)

McBride, Neil

Urwin, T. W.

Davies, Ednyfed Hudson (Conway)

MacDermot, Niall

Varley, Eric G.

Davies, Harold (Leek)

Macdonald, A. H.

Wainwright, Edwin (Dearne Valley)

Davies, Ifor (Gower)

McGuire, Michael

Wainwright, Richard (Colne Valley)

Davies, S. O. (Merthyr)

Mackenzie, Alasdair (Ross & Crom'ty)

Walden, Brian (All Saints)

Dempsey, James

Maclennan, Robert

Wallace, George

Dewar, Donald

McMillan, Tom (Glasgow, C.)

Watkins, Tudor (Brecon & Radnor)

Dickens, James

Mahon, Peter (Preston, S.)

Weitzman, David

Dobson, Ray

Mallalieu, J. P. W. (Huddersfield, E.)

Wellbeloved, James

Doig, Peter

Manuel, Archie

White, Mrs. Eirene

Dunnett, Jack

Mapp, Charles

Whitlock, William

Dunwoody, Mrs. Gwyneth (Exeter)

Marquand, David

Willey, Rt. Hn. Frederick

Edelman, Maurice

Mellish, Robert

Williams, Alan (Swansea, W.)

Edwards, Rt. Hn. Ness (Caerphilly)

Mendelson, J. J.

Williams, Clifford (Abertillery)

Edwards, William (Merioneth)

Milne, Edward (Blyth)

Wilson, William (Coventry, S.)

Ellis, John

Mitchell, R. C. (S'th'pton, Test)

Winstanley, Dr. M. P.

Ensor, David

Morgan, Elystan (Cardiganshire)

Winterbottom, R. E.

Evans, Albert (Islington, S. W.)

Morris, Alfred (Wythenshawe)

Woodburn, Rt. Hn. A.

Evans, Ioan L. (Birm'h'm, Yardley)

Morris, Charles R. (Openshaw)

Woof, Robert

Finch, Harold

Neal, Harold

Yates, Victor

Fletcher, Ted (Darlington)

Norwood, Christopher

Foot, Michael (Ebbw Vale)

O'Malley, Brian

TELLERS FOR THE AYES:

Galpern, Sir Myer

Orme, Stanley

Mr. W. Howie and

Gardner, Tony

Oswald, Thomas

Mr. Harold Walker.

Garrett, W. E.

Owen, Will (Morpeth)

NOES

Allason, James (Hemel Hempstead)

Dance, James

Heseltine, Michael

Astor, John

Digby, Simon Wingfield

Hiley, Joseph

Bennett, Dr. Reginald (Gos. & Fhm)

Doughty, Charles

Holland, Philip

Birch, Rt. Hn. Nigel

Elliot, Capt. Walter (Carshalton)

Hordern, Peter

Body, Richard

Elliott, R. W. (N'c'tle-upon-Tyne, N.)

Hornby, Richard

Brinton, Sir Tatton

Errington, Sir Eric

Hutchison, Michael Clark

Bromley-Davenport, Lt.-col.Sir Walter

Farr, John

Jennings, J. C. (Burton)

Brown, Sir Edward (Bath)

Fletcher-Cooke, Charles

Jopling, Michael

Bullus, Sir Eric

Foster, Sir John

Kershaw, Anthony

Channon, H. P. G.

Gibson-Watt, David

Lancaster, Col. C. G.

Clegg, Walter

Grant, Anthony

Lane, David

Cooke, Robert

Grant-Ferris, R.

Lloyd, Rt. Hn. Selwyn (Wirral)

Cooper-Key, Sir Neill

Grieve, Percy

Loveys, W. H.

Cordle, John

Hall-Davis, A. G. F.

McMaster, Stanley

Costain, A. P.

Harris, Frederic (Croydon, N.W.)

Maddan, Martin

Craddock, Sir Beresford (Spelthorne)

Harrison, Col. Sir Harwood (Eye)

Maginnis, John E.

Crosthwaite-Eyre, Sir Oliver

Hawkins, Paul

Maude, Angus

Cunningham, Sir Knox

Hay, John

Maxwell-Hyslop, R. J.

Dalkeith, Earl of

Heald, Rt. Hn. Sir Lionel

Mills, Stratton (Belfast, N.)

1568

1569

Mitchell, David (Basingstoke)

Pink, R. Bonner

Summers, Sir Spencer

Montgomery, Fergus

Pounder, Rafton

Taylor, Frank (Moss Side)

More, Jasper

Price, David (Eastleigh)

Thatcher, Mrs. Margaret

Morgan, Geraint (Denbigh)

Prior, J. M. L.

van Straubenzee, W. R.

Morrison, Charles (Devizes)

Pym, Francis

Walker-Smith, Rt. Hn. Sir Derek

Murton, Oscar

Quennell, Miss J. M.

Ward, Dame Irene

Nabarro, Sir Gerald

Renton, Rt. Hn. Sir David

Weatherill, Bernard

Orr-Ewing, Sir Ian

Rippon, Rt. Hn. Geoffrey

Webster, David

Osborne, Sir Cyril (Louth)

Rossi, Hugh (Hornsey)

Wills, Sir Gerald (Bridgwater)

Page, Graham (Crosby)

Russell, Sir Ronald

Worsley, Marcus

Page, John (Harrow, W.)

Shaw, Michael (Sc'b'gh & Whitby)

Younger, Hn. George

Pearson, Sir Frank (Clitheroe)

Silvester, Fred (Walthamstow, W.)

Percival, Ian

Smith, John

TELLERS FOR THE NOES:

Peyton, John

Stodart, Anthony

Mr. Reginald Eyre and

Mr. Timothy Kitson.

Lords Amendment No. 5: In page 5, line 5, leave out from "Where" to "been" in line 6, and insert "a tenancy is or has".
Read a second time.
Mr. Allason: I beg to move, as an Amendment to the Lords Amendment, after 'tenancy', to insert:
'(not being a tenancy to which the Rent Acts apply)'.
Mr. Walter Clegg: I, too, welcome the hon. and learned Gentleman the Minister of State to the field of land law. I hope that he does not find the transition one from the works of Enid Blyton to the works of Sigmund Freud in one fell swoop.
I should also pay tribute to the dear departed—the right hon. Gentleman the Member for Sunderland, North (Mr. Willey). He was the first Minister with whom I crossed swords in the House and was always courteous. At the same time he was, I think, one of the most Socialist of all the Ministers and he met the end that all Socialist Ministers must inevitably meet—the chop.
In another place Lord Hughes moved this Amendment because the original drafting of the subsection was inelegant. I suppose that if a man is to lose his land he might as well lose it elegantly as inelegantly. But there is a point of some seriousness which crops up in this Clause which this Amendment is designed to meet. This arises from the use of the words about "the obligation" of the landlord to renew the lease. It is not only a covenant but an obligation. Does the word "obligation" in this context mean that it could be a statutory obligation? What comes to our minds is that by Statute landlords have to prolong a tenancy not purely by covenant. If one takes the case under the Rent Act the landlord has to extend the tenancy. When the tenant dies the new tenancy has to be
1570
extended to a member of the family. We should like some reassurance that this Amendment and the Clause with which it is concerned does not mean that Rent Act properties will be included. That is why we put down the Amendment. It does not seem clear. The word "obligation" is a somewhat unusual word to use in this context and I would ask the Minister, if he can, to give us some reassurance on this and, if he cannot reassure us, to accept the Amendment.
Mrs. White: I am grateful to the hon. Member for North Fylde (Mr. Clegg) for putting this point. I hope that I can reassure him, because it is not just this Clause that one has to take into account, but the Clause which provides for the low rent. The definitions for this purpose really eliminate the point which seems to be worrying him. As I understand it, if one takes the low rent Clause as well, then by definition a tenancy to which the Rent Act applies must be at a rent exceeding two-thirds of the rate-able value as at 23rd March, 1965. Therefore, by that definition, and in a subsequent Clause, the point which the hon. Member seems to be concerned about is covered. It means that those which come under the Rent Act provisions could not by definition come under this one.
Mr. Graham Page: I do not think that is a satisfactory answer. This Clause provides for a lease, originally perhaps for a short period of a week, a month or a year, being a lease which is renewable by the tenant and has been renewed for a period over 21 years. It then becomes a long lease provided that it is at a low rent and the tenant will have the right to enfranchise. This happens only if there is a covenant or an obligation by the landlord to renew.
Suppose that property within the area of controlled property was let 22 years ago. It may well be that its rent then

1571
and perhaps now is less than the two-thirds required to bring it outside the Act. The landlord has been under an obligation throughout the 22 years to renew—not an obligation under the lease or tenancy itself, but an obligation by Statute. That is the word which is used in this Clause: that if there is a covenant or obligation for renewal and the lease has been renewed for a period over 21 years then it is treated as a long lease. It would be ridiculous to think that it is the intention of the Act that a controlled tenant who has been in occupation for 21 years and one day should be entitled to enfranchise under this Act merely because there was a statutory obligation on the landlord to continue that tenancy.
There may be very few tenancies which come under this provision, but, even if there are a few, surely it was not intended to bring them into the net of this Bill, and provision should be made to exclude them. I do not think that they are excluded by any other provision of the Bill. They are included by the use of the word "obligation", and the Amendment which we have suggested merely puts that right. It puts words in after "tenancy" which would exclude the sort of case which I have tried to describe.
Mr. MacDermot: Perhaps I can assist the House on this somewhat technical legal point which has been raised. As I understand it, the purpose of the Amend-
ment is to exclude from these provisions any tenancy to which the Rent Act applies and to see that there would not be enfranchisement in any such case.
As the Minister of State, Welsh Office, pointed out, that problem cannot arise, because, in order for the Rent Act to apply to a tenancy, it must be at a rent exceeding two-thirds of the rateable value at the appropriate date in March, 1965. Any tenancy which complies with that and, therefore, from that point of view, could be within the Rent Act, is excluded from the provisions of this Bill by the requirement in Clause 4 that the rent must be less than two-thirds of the rateable value in order to qualify as a low rent. Therefore, I do not see how the problem can arise.
Mr. Graham Page: Before the hon. and learned Gentleman sits down, there is the case, examples of which my hon. Friend the Member for Basingstoke (Mr. David Mitchell) gave when we were discussing the last Amendment, where there might have been a premium lease over 21 years thereby reducing the rack rent to a figure below the two-thirds.
Mr. MacDermot: In that case the Rent Act would not apply.
Question put, That those words be there inserted in the Lords Amendment:—
The House divided: Ayes 85, Noes 169.

Division No. 493.]

AYES

[7.8 p.m.

Allason, James (Hemel Hempstead)

Harris, Frederic (Croydon, N.W.)

Pearson, Sir Frank (Clitheroe)

Astor, John

Hawkins, Paul

Percival, Ian

Bennett, Dr. Reginald (Gos. & Fhm)

Hay, John

Pink, R. Bonner

Body, Richard

Heald, Rt. Hn. Sir Lionel

Pounder, Rafton

Brinton, Sir Tatton

Heseltine, Michael

Price, David (Eastleigh)

Bromley-Davenport, Lt.-Col. Sir Walter

Hiley, Joseph

Prior, J. M. L.

Brown, Sir Edward (Bath)

Holland, Philip

Pym, Francis

Bullus, Sir Eric

Hordern, Peter

Quennell, Miss J. M.

Channon, H. P. G.

Hutchison, Michael Clark

Renton, Rt. Hn. Sir David

Clegg, Walter

Jennings, J. c. (Burton)

Rippon, Rt. Hn. Geoffrey

Cooke, Robert

Kitson, Timothy

Rossi, Hugh (Hornsey)

Cooper-Key, Sir Neill

Lancaster, Col. C. G.

Russell, Sir Ronald

Cordle, John

Lane, David

Shaw, Michael (Sc'b'gh & Whitby)

Costain, A. P.

Lloyd, Rt. Hn. Selwyn (Wirral)

Silvester, Fred (Walthamstow, W.)

Craddock, Sir Beresford (Spelthorne)

Loveys, W. H.

Smith, John

Cunningham, Sir Knox

McMaster, Stanley

Stodart, Anthony

Dalkeith, Earl of

Maddan, Martin

Summers, Sir Spencer

Dance, James

Maginnis, John E.

Thatcher, Mrs. Margaret

Digby, Simon Wingfield

Maude, Angus

van Straubenzee, W. R.

Doughty, Charles

Maxwell-Hyslop, R. J.

Walker-Smith, Rt. Hn. Sir Derek

Elliot, Capt. Walter (Carshalton)

Mills, Stratton (Belfast, N.)

Ward, Dame Irene

Elliott, R. W. (N'c'tle-upon-Tyne, N.)

Mitchell, David (Basingstoke)

Weatherill, Bernard

Errington, Sir Eric

Montgomery, Fergus

Webster, David

Farr, John

More, Jasper

Wills, Sir Gerald (Bridgwater)

Fletcher-Cooke, Charles

Morgan, Geraint (Denbigh)

Younger, Hn. George

Foster, Sir John

Murton, Oscar

Gibson-Watt, David

Nabarro, Sir Gerald

TELLERS FOR THE AYES:

Grant-Ferris, R.

Nicholls, Sir Harmar

Mr. Anthony Grant and

Grieve, Percy

Osborne, Sir Cyril (Louth)

Mr. Reginald Eyre.

Hall-Davis, A. G. F.

Page, Graham (Crosby)

NOES

Alldritt, Walter

Gourlay, Harry

Page, Derek (King's Lynn)

Allen, Scholefield

Gregory, Arnold

Pannell, Rt. Hn. Charles

Anderson, Donald

Grey, Charles (Durham)

Park, Trevor

Archer, Peter

Griffiths, David (Rother Valley)

Parkyn, Brian (Bedford)

Atkins, Ronald (Preston, N.)

Griffiths, Rt. Hn. James (Llanelly)

Pavitt, Laurence

Atkinson, Norman (Tottenham)

Griffiths, Will (Exchange)

Pearson, Arthur (Pontypridd)

Bacon, Rt. Hn, Alice

Hale, Leslie (Oldham, W.)

Pentland, Norman

Beaney, Alan

Hamilton, James (Bothwell)

Perry, George H. (Nottingham, S.)

Bidwell, Sydney

Hamling, William

Price, Thomas (Westhoughton)

Binns, John

Harper, Joseph

Price, William (Rugby)

Blackburn, F.

Harrison, Walter (Wakefield)

Probert, Arthur

Boardman, H.

Haseldine, Norman

Rhodes, Geoffrey

Booth, Albert

Hilton, W. S.

Robinson, W. O. J. (Walth'stow, E.)

Boston, Terence

Hooson, Emlyn

Rogers, George (Kensington, N.)

Bottomley, Rt. Hn, Arthur

Horner, John

Rowlands, E. (Cardiff, N.)

Braddock, Mrs. E. M.

Howarth, Harry (Wellingborough)

Ryan, John

Brooks, Edwin

Howarth, Robert (Bolton, E.)

Shaw, Arnold (Ilford, S.)

Brown, Bob (N'c'tle-upon-Tyne, W.)

Huckfield, Leslie

Sheldon, Robert

Buchan, Norman

Hughes, Emrys (Ayrshire, S.)

Shinwell, Rt. Hn. E.

Buchanan, Richard (G'gow, Sp'burn)

Hughes, Hector (Aberdeen, N.)

Short, Mrs. Renée (W'hampton, N. E.)

Cant, R. B.

Hughes, Roy (Newport)

Silkin, Rt. Hn. John (Deptford)

Carter-Jones, Lewis

Hunter, Adam

Silkin, Hn. S. C. (Dulwich)

Chapman, Donald

Jackson, Peter M. (High Peak)

Silverman, Julius (Aston)

Coe, Denis

Janner, Sir Barnett

Silverman, Sydney (Nelson)

Coleman, Donald

Jeger, Mrs. Lena (H'b'n & St.P'cras, S.)

Skeffington, Arthur

Conlan, Bernard

Johnson, Carol (Lewisham, S.)

Slater, Joseph

Corbet, Mrs. Freda

Jones, Dan (Burnley)

Small, William

Craddock, George (Bradford, S.)

Jones, J. Idwal (Wrexham)

Spriggs, Leslie

Crawshaw, Richard

Jones, T. Alec (Rhondda, West)

Summerskill, Hn. Dr. Shirley

Cullen, Mrs. Alice

Kerr, Russell (Feitham)

Swain, Thomas

Dalyell, Tam

Leadbitter, Ted

Symonds, J. B.

Davidson, Arthur (Accrington)

Ledger, Ron

Tinn, James

Davies, Dr. Ernest (Stretford)

Lester, Miss Joan

Tomney, Frank

Davies, G. Elfed (Rhondda, E.)

Lipton, Marcus

Urwin, T. W.

Davies, Ednyfed Hudson (Conway)

Loughtin, Charles

Varley, Eric G.

Davies, Harold (Leek)

McBride, Neil

Wainwright, Edwin (Dearne Valley)

Davies, Ifor (Gower)

MacDermot, Niall

Wainwright, Richard (Colne Valley)

Davies, S. O. (Merthyr)

Macdonald, A. H.

Walden, Brian (All Saints)

Dempsey, James

McGuire, Michael

Wallace, George

Dewar, Donald

McMillan, Tom (Glasgow, C.)

Watkins, Tudor (Brecon & Radnor)

Dickens, James

Mahon, Peter (Preston, S.)

Weitzman, David

Dobson, Ray

Mallalieu, J. P. W. (Huddersfield, E.)

Wellbeloved, James

Doig, Peter

Manuel, Archie

White, Mrs. Eirene

Dunnett, Jack

Mapp, Charles

Whitlock, William

Dunwoody, Mrs. Gwyneth (Exeter)

Marquand, David

Willey, Rt. Hn. Frederick

Edelman, Maurice

Mellish, Robert

Williams, Alan (Swansea, W.)

Edwards, Rt. Hn. Ness (Caerphilly)

Mendelson, J. J.

Williams, Clifford (Abertillery)

Edwards, William (Merioneth)

Milne, Edward (Blyth)

Wilson, William (Coventry, S.)

Ellis, John

Mitchell, R. C. (S'th'pton, Test)

Winstanley, Dr. M. P.

Ensor, David

Morgan, Elystan (Cardiganshire)

Winterbottom, R. E.

Evans, Albert (Islington, S.W.)

Morris, Alfred (Wythenshawe)

Woodburn, Rt. Hn. A.

Evans, Ioan L. (Birm'h'm, Yardley)

Neal, Harold

Woof, Robert

Finch, Harold

Norwood, Christopher

Yates, Victor

Fletcher, Ted (Darlington)

O'Malley, Brian

Foot, Michael (Ebbw Vale)

Orme, Stanley

TELLERS FOR THE NOES:

Galpern, Sir Myer

Oswald, Thomas

Mr. W. Howie and

Gardner, Tony

Owen, Will (Morpeth)

Mr. Harold Walker.

Garrett, W. E.

Padley, Walter

Mrs. White: I beg to move, That this House doth agree with the Lords in the said Amendment.
It may be for the convenience of the House if with this we also consider Lords Amendments No. 7, No. 8 and No. 9, because, although we have subsequently to deal with Lords Amendment No. 8, this group of Amendments is a group of drafting Amendments. We hope that the House will agree that they improve Clause 3(4) which, because of the various Amendments made at various times, in its present form now greatly distresses the draftsmen, because, as they point out, references to the future are
1574
made in the pluperfect tense. These Amendments are therefore primarily grammatical. I shall later move the Amendment to Lords Amendment No. 8 to bring it into line with what has been decided about the period of years.
Mr. Speaker: It is suggested that we should discuss Lords Amendments Nos. 7, 8 and 9 with this in order to solve the problem of the imperfect pluperfect tenses, but that we shall have to consider an Amendment to the Lords Amendment No. 8 when we come to it.
Sir John Foster: I do not need to disclose my interest in the grammatical point, but I do not understand

1575
Lords Amendment No. 7. We are asked to substitute "is or has" for "had", which would leave the provision reading:
"… the tenancy is or has once or more …"
I do not see how the wording fits. One cannot say that a tenancy is or has once or more renewed.
Mrs. White: The wording would be:
"is or has been once or more renewed."
Question put and agreed to.
Lords Amendment, in page 5, line 7, disagreed to.
Lords Amendment, in page 5, line 9, agreed to.
Lords Amendment, in page 5, line 10, leave out "that" and insert "as to bring to more than fifty years", read a second time and amended, by leaving out the word "fifty" and inserting the word "twenty-one"—[Mrs. Eirene White],—instead thereof,—and, as amended, agreed to.
Lords Amendment, in page 5, line 12, agreed to.
Lords Amendment, in page 5, line 14, disagreed to.

Clause 2.—(MEANING OF "HOUSE" AND "HOUSE AND PREMISES", AND ADJUSTMENT OF BOUNDARY.)
Lords Amendment No. 3: In page 4, line 5, after first "minerals" insert "comprised in the tenancy".
6.15 p.m.
Mr. Skeffington: I beg to move, That this House doth agree with the Lords in the said Amendment.
This is really not more than a drafting Amendment. It is designed to ensure that in any reference to minerals the rights of a leaseholder under the Bill are confined to what is in the lease. I think this probably was the position before, but the insertion after the first "minerals" in line 5 of the words "comprised in the tenancy" makes it absolutely clear that if minerals are not in the agreement, even though they may be under the property, there is no question of the tenant acquiring any rights or any of the legal obligations which flow from that. I am
1556
sure the House will be glad to accept the Amendment.
Question put and agreed to.

Clause 4.—(MEANING OF LOW RENT.)
Lords Amendment No. 11: In page 5, line 41, leave out "and" and insert:
"Provided that a tenancy granted between the end of August 1939 and the beginning of April 1963 otherwise than by way of building lease (whether or not it is, by virtue of section 3(3) above, to be treated for other purposes as forming a single tenancy with a previous tenancy) shall not be regarded as a tenancy at a low rent if at the commencement of the tenancy the rent payable under the tenancy exceeded two-thirds of the letting value of the property (on the same terms)."
Read a second time.
Mr. Speaker: Mr. Allason.
Mr. MacDermot Mr. MacDermot rose—
Mr. Speaker: Mr. MacDermot. Point of order.
Mr. MacDermot: I was proposing to move the Motion, not to raise a point of order.
Mr. Speaker: Order. Let me help the hon. and learned Gentleman. We have an Amendment which I have selected, the Amendment to line 1. We must take Amendments to the Lords Amendment before we decide what we
1576
are to do about the Lords Amendment itself.
Mr. Allason: I beg to move, as an Amendment to the Lords Amendment, in line 1, leave out from 'granted' to 'otherwise' in line 2.
It might be convenient if we could discuss the other Amendments which you have selected to be discussed, which I understand to be the two Amendments to line 7, in line 7, after 'tenancy', insert 'was equal to or'; and, in line 7, leave out from 'the' to end of line 8 and insert
'the rateable value of the property on the first day of the term'.
Mr. Speaker: I have not selected that for separate debate but I have suggested that we discuss with the hon. Gentleman's Amendment, the second Amendment to line 7.
Mr. Allason: It would be best to took at the situation presented to us by the Lords Amendment before getting to the effect of the Amendment which I am moving, and the subsequent Amendment which we are discussing with it. In the course of the Bill we have pressed very consistently that there is a flaw in the definition in the Bill of ground rent as being two-thirds of the current rateable value, because it is liable to catch some genuine rack rents settled some time ago at a fairly low rent, but which now, owing to rising rateable values, will come to be defined as ground rents.
It cannot be the intention of the Government that what was once a genuine rack rent should now be defined as a ground rent. To give an example, we now have within the Bill, a rateable value limit for houses outside London of £200. Before 1963 that would have been roughly one-third. Rateable values went up by approximately three times. The rateable value before 1963 was about £70, which is the highest level of house outside London remaining in the Bill. If it was a rateable value of £70, that would be equivalent to a gross value of about £90.
But two-thirds of the current rateable value is £133. We would have the situation whereby the rack rent of a house, which some years ago had a certain gross value, which is not the letting value but is the district valuer's opinion of its letting value, would, under the definition of this Bill, become a ground rent if it

1577
was let for substantially more than that £133.
Clearly, the further one goes back the greater is the danger that a perfectly reasonable rack rent shall now be defined as a ground rent, because of the two-thirds valuation placed in the Bill. The Lords Amendment deals with these for the period from August, 1939 to April, 1963. It substitutes for this two-thirds current rateable value a new term, that is two-thirds of the letting value at the commencement of the lease.
I take it that it is intended to be at the commencement of the lease, because in the wording of the Lords Amendment it says:
"… if at the commencement of the tenancy the rent payable under the tenancy exceeded two-thirds of the letting value of the property (on the same terms)."
It is not at all clear that that means the letting value at the time when the tenancy was granted, but let us assume that it was that. This vastly improves matters, because for this period from 1939 to 1963, at least we get a different definition and there is less danger of the rack rent being misinterpreted as ground rent under the terms of the Bill. If we can discover the letting value at that time, quite clearly a lease of two-thirds of the letting value is unlikely to be a rack rent, unless the landlord is slightly off his head.
The earlier one goes back, the more likely it is that the rack rent will be low, and consequently will become confused with the ground rent now. It is not clear why this change should only operate from August, 1939 to April, 1963. Any lease granted before August, 1939, which is still existing, would tend to be in an even more anomalous position than those within the wartime and post-war period of leases.
Mr. Speaker: Order. It is difficult for the hon. Member to address the House against a background of sustained conversation.
Mr. Allason: Coming now to the Amendment. The first Amendment leaves out the dated periods so that the letting value is taken over the whole period as the method of determination. This is a fairly satisfactory solution, and I cannot see why it should not operate over the whole period instead of retaining the two-thirds rateable value provision for some other periods. The existence of two
1578
different definitions would only confuse the Bill.
7.30 p.m.
On the second Amendment, I go further in my criticism of letting value, to which I gave modified greeting, since it obviously improves the position. But the position could be much more improved by this Amendment. Instead of the letting value, we would take the rating value of the property at commencement of the lease. This known fact can be discovered simply, whereas the letting value in 1940 will be extremely difficult to discover and will be subect to much argument, with both sides employing surveyors to argue it. Rateable value will be firm and definite.
In addition, letting value varied during the war from day to day or from month to month. As the blitz increased or decreased so letting values changed. At some stages, one could not find anyone to occupy one's house and the letting value was virtually nothing. In other areas, the nice safe areas, the situation was exactly the opposite, with very high letting values. Therefore, letting value has considerable disadavantage as a basis for calculation; rateable value when the lease started is a much better proposition. I hope that the Government will accept the Amendment. We are grateful that they have taken a move in the right direction, but it is not a very wise move.
Mr. MacDermot: I am grateful for the general welcome which the hon. Member for Hemel Hempstead (Mr. Allason) gave the Amendments to which these two Amendments are proposed. I also find it difficult to discuss these two Amendments except against the background of the Government Amendments. These Amendments are an attempt to meet a point which worried both sides in Committee and on Report. My hon. and learned Friend the Member for Dulwich (Mr. S. C. Silkin) first drew the attention of the Committee to the fact that the two-thirds rateable value rule could be unfair to some landlords in view of the practice in the immediate post-war years of granting rack rent tenancies for longer terms than 21 years.
Because of the decline in the value of money, some of those rack rent tenancies are now at rents less than two-thirds of the rateable value, following the revision of the rating system which took effect

1579
in 1963. All the evidence is that this practice began immediately after the war. It is not a continuing problem, partly because of the revision of the system and partly because the practice now is for anyone who grants a long lease on rack rent terms to include rent revision clauses in the agreement to ensure that he will not be caught as were some owners under those kinds of agreement.
It was not, of course, the intention of anyone who has been campaigning, as many of us have for many years, for leasehold enfranchisement that it should apply to rack rent tenancies. Consequently, when I found how both sides had been disturbed by this problem, I was anxious to solve it. I am glad to hear that the hon. Gentleman thinks that we have gone some way to meet the problem.
His two Amendments propose variations of our proposal. First, he does not want it confined to leases granted between August 1939 and the date when the new rating system came into force—1st April, 1963—but wants it to be at large. My answer to that is twofold. First, we have no evidence of any practice of granting leases of that kind, except starting in the immediate post-war years. We have allowed a margin of error here by going back to 1939, and, since we know of no practical reason for going back further, we are not inclined to, especially as we see a very good practical reason why we should not.
The hon. Gentleman himself said that it might be very difficult for a landlord to produce evidence of letting values in 1940, and I suggest that it would be even more difficult if the year were 1840, which might be the result of the Amendment. It might be argued that the rent of a tenancy granted in the last century was less than two-thirds of the letting value at the date of the grant. I confirm that that is the meaning of the words in the Amendment. That is the date which must be considered both to the letting value and to the actual rent under the agreement. This is a severely practical reason for going back no further.
The cut-off date of 1st April is necessary, anyway, to avoid a clash with the transitional provisions in Clause 35—certainly no later than 8th December, 1964. In any event, that was the date when the rating system was brought up
1580
to date and obviated the problem. There is also the practice of rent revision Clauses. On reflection, I think that the House will agree that a date limit to this special provision is wise.
Mr. Allason: Would the hon. and learned Gentleman not agree that if he accepted both Amendments, this difficulty would be obviated?
Mr. MacDermot: If the hon. Member will be patient, I will tell him a good reason why the House should not accept the second Amendment. It goes back to one of the solutions tried and probed and found wanting in Committee. When the House tried to solve this problem, the first thing was to see whether the rent under the agreement could be related to the rateable value at the time of the agreement instead of to the rateable value in 1963. The difficulty about that is that the rateable values in the period with which we are most concerned—the immediate post-war years—were 1939 rateable values. As the hon. Member will know from his experience, because we did not then have a unified rating system the result was that there were ludicrously low rating assessments in particular areas. It did not matter for one of those areas, because they secured the tone of the list in their own area and aimed at the same treatment for all lettings in the area.
One knows, and one need not repeat, the reasons why there was a temptation to value low. The fact is, however, that they were valued very low. I am assured that there are examples of genuine ground leases with ground rents of the order of £10 a year, which would be excluded if one took the current rateable value, because rateable values were as low as about £15. The suggested solution would, therefore, be quite unworkable and would exclude an enormous number of genuine ground leases.
It was for the same reason that we had to advise the rejection of a provision, which was written in at one stage in the other place, to take one-third instead of two-thirds of the rateable value. When we come to the other end of the time scale, we encounter the problem that genuine ground leases are created at the present time when the ground rent is more than one-third of the rateable value. Again, therefore, that would not give the right result.

1581
It was for those reasons that we put forward the Lords Amendments in this way. They will help to provide a workable solution to the problem, and I must advise the House to reject both Amendments to them.
Mr. Graham Page: This is an example of our difficulties in dealing with the Bill, which has been brought to the House only the day after Third Reading in another place when the Lords Amendment was introduced. The unfairness of including property of which the rent is as much as two-thirds of the rateable value or just under was mentioned on Second Reading in this House. It was debated in Committee and on Report and at each stage in another place.
Although the Minister of State has said that hon. Members on both sides of the Committee were worried, they may have been worried from the back benches on the Government side but there appeared to be no worry about it until this stage from the Government Front Bench. We are, therefore, faced with trying to understand a difficult Amendment of this nature only a few hours after it was passed in another place yesterday.
I have tried to work out how the Lords Amendment would operate and what would be the effect of our Amendment to it. There are various permutations that can be used for examples, but to use figures is probably confusing. Two points are involved in the Amendments. By our Amendment to line 1 of the Lords Amendment, we say that if it is right for the Lords Amendment to be applied for the 1939–1963 period, it is right for it to be applied at all This should always be the alternative for the landlord if the property is near the margin of the rateable value limit. There will, of course, be occasions when it would be impossible for either party to prove one way or the other what was the letting value at any one time, what was the letting value on the first day of the term of the lease or, if it is a 99-year lease, the letting value in the last century. That could not be proved. Therefore, the alternative could not he used. That, however, is no reason why it should not be an alternative at all times.
1582
7.45 p.m.
I am puzzled by the Minister of State's remark that the Ministry has no evidence of a practice of rack rent leases for more than 21 years prior to the war. I do not know why the Ministry should have any evidence of it or how it could get evidence one way or the other. I am surprised to learn that there is no such evidence. I cannot think of any occasion in my practice when I have had one, but, equally, I cannot think that rack rent leases were extraordinary at that time. For scores of years, landlords and tenants have agreed between each other a premium as opposed to a rent, a rent as opposed to a premium. I am sure that this happened with residential property for many years before 1939.
The purpose of our Amendment to line 7 of the Lords Amendment is to return to rateable value instead of letting value but to return to it as it exists at the time when the lease is granted. This seems to be the most fair way of deciding what is a low rent. One is then looking at the intention of the parties when the lease was created. If it is possible to compare the ground rent with the rateable value at the time the lease was granted, one gets the intention of the parties as to whether it should be a lease at a low rent.
Mr. S. C. Silkin: I have been following this part of the hon. Member's argument. Can he explain why he puts it that way? Surely, the Lords Amendment gives a considerable leeway between the true rack rent and the position which is covered by the Clause. It gives virtually one-third of the rack rent as a leeway. Surely, that is much safer than relying on a rateable value which may be purely artificial.
Mr. Page: That brings me to the point of asking what is meant by "letting value". It seems to me that we are still basing our calculations on rateable value, because I anticipate that what will be said to be rateable value is the gross value. That is merely worked out from the rateable value. Perhaps, however, it is better to deal with this when the Lords Amendment is being debated and I will ask the question then.
In putting forward our Amendment to substitute rateable value for letting value, it seemed to me to be a much

1583
fairer way as between the parties of ascertaining their intentions concerning the rent and whether they meant it to be a ground lease if we consider the rateable value at the time when the lease was granted.
Amendment negatived.
Mr. MacDermot: Are you inviting hon. Member's opposite to put formally the second of their Amendments, Mr. Deputy Speaker, before we discuss the Lords Amendments themselves?
Mr. Deputy Speaker (Sir Eric Fletcher): The second Amendment in the name of the hon. Member for Crosby (Mr. Graham Page), in line 7, of the Lords Amendment, is not selected. I understand that the hon. Member's third Amendment, also in line 7, has been discussed with the first Amendment. Therefore, I was not proposing to put it. The hon. Member's fourth Amendment, in line 8, of the Lords Amendment, is not selected. I therefore invite the Government to move a proposal with regard to Lords Amendment No.11.
Mr. Graham Page: On a point of order. We understood from Mr. Speaker's statement about the Amendments that he had selected the second Opposition Amendment to this Lords Amendment; that is, the first Amendment in line 7. He said that the second Amendment in line 7 would be discussed with the Amendment in line 1. I understood that the first three Amendments were selected in that way, while the fourth was not.
Mr. MacDermot: I am not sure whether or not the hon. Gentleman was in the House, but I recall that when these Amendments were called, Mr. Speaker made it clear that he was selecting the second Amendment in line 7 for debate.
Mr. Allason: With my hon. Friend the Member for Crosby (Mr. Graham Page). I was in the House and understood Mr. Speaker to say that he would call the second Amendment in line 7, whereupon the Minister intervened to say that he surely meant the third Amendment.
Mr. MacDermot: At the time this question was asked of Mr. Speaker it was made clear that Mr. Speaker was selecting the second Amendment in line 7.
Mr. Deputy Speaker: The position seems clear. The first Amendment in line
1584
I has been disposed of. The first Amendment in line 7 is not selected. The second Amendment in line 7 has been discussed with the Amendment in line 1, and now falls. The Amendment in line 8 is not selected. I now invite the Government to move a Motion in regard to Lords Amendment No. 11.
Mr. MacDermot: I beg to move, That this House doth agree with the Lords in the said Amendment.
Mr. Deputy Speaker: Would it be convenient to discuss, at the same time, Lords Amendments Nos. 12, 13, 14 and 16?
Mr. MacDermot: Yes, Mr. Deputy Speaker.
I can deal with this Amendment briefly because we discussed the general effect of it and of the other Amendments being taken with it in our debate on the last Amendment. There appears to be general agreement on the desirability of the Amendment.
Only one point has not been clearly brought out. I wish to make it clear that the provision in this series of Amendments is something of which the landlord can, if he wishes, avail himself, but the initiative will have to lie with him and the onus of proof will lie upon him. In other words, it will not be necessary for enfranchising leaseholders to go to all the pains of trying to produce negative evidence to defeat this possibility—which would, of course, only be an exceptional case—and in such an exceptional case the evidence is likely to lie much more in the hands of the landlord than in those of the tenant. We therefore think it right, if the landlord wishes to avail himself of it, that the burden of proof in this matter should lie on him.
Mr. Allason: This shows the extreme difficulty in which one finds oneself when asked to consider Amendments of this kind at such short notice. Only a very short period of warning has been given to us and I have not had time to check through the procedure.
My recollection of the procedure under Clause 5 is that once a tenant has given notice to a landlord of his wish to have the freehold, he is entitled to work on the supposition that he will get it and that he is even entitled to assign his right.

1585
In other words, he can sell the freehold that will come to him.
This arrangement is highly unsatisfactory in the light of Amendment No. 14, with its proviso about when this process should start to operate. Surely it should work the other way; that if a landlord says, "I do not agree that your notice is valid because I shall claim that it is not a ground lease because of the proviso", then at that stage this fact should operate against the tenant. If not—if I am correct in what I believe is meant by Clause 5, Schedule 1 and the other provisions relating to this matter—the tenant can proceed on the basis that he will succeed.
This is a hopeless proposition, particularly if at a much later stage the landlord must provide all the proof. Obviously he cannot do that on the first day. It will take a considerable time before he is able to prove to the court or tribunal that it is not a ground lease. We have heard that there will be a considerable argument on this score and therefore, at the earliest stage, the proviso should operate so that a stop is put on the tenant acquiring the freehold—that is, until the matter has been sorted out.
Mr. Graham Page: I thought that we would be given an answer to our questions on this Amendment. In addition to the points raised by my hon. Friend the Member for Hemel Hempstead (Mr. Allason) there are some general matters which I must put before the House. We are told in the Amendment that the rent shall not exceed two-thirds. In Clause 4, where this is referred to by reference to the rateable value, the phrase is:
"… equal to or more than two-thirds of the rateable value …"
We are, therefore, taking a different standard when judging it against the rateable value compared with the rent value. This is an unnecessary complication and it would have been better to have used the same standard in each case.
What is "letting value"? It is not defined in the Bill and it seems that merely to use the words
"… the letting value of the property …"
is an invitation to litigation. I can imagine endless cases over what is the letting value of property and when it is to be judged. I agree that the Amendment states that we are dealing with
1586
"… rent … at the commentment of the tenancy …"
but those words are not repeated after the phrase "letting value". Will the Minister give an assurance that the proper interpretation of this provision as drafted is that the letting value is to be taken at the commencement of the tenancy? Why not spell this out in the Bill?
I trust that we will be told, first, why the phrase "equal to" has not been used, as it is used in Clause 4, secondly, the definition of "letting value", and, thirdly, at what date the letting value is to be estimated.
Mr. MacDermot: I to some extent anticipated the hon. Gentleman's question about the onus of proof when moving the Amendment; when I said, and gave reasons why, it is sensible to put the onus of proof on the landlord rather than on the tenant.
To answer his question about the need for a stop, the landlord can claim the benefit of this proviso, and I would expect him to do so, in his notice in reply, which must be given within two months of the application being made by the tenant. That would then put the enfranchishing tenant on warning that this issue is to be raised—and if the matter cannot be resolved, it would eventually have to be determined in litigation.
8.0 p.m.
I do not think that there is any particular intention behind the reference to two-thirds. We are here not dealing with a formula in relation to rating, where no doubt the precise wording would have been used. I should have thought that it made very little difference in practice.
The letting value is a term that already appears in Clause 15(2), and the meaning of the term here would be the same as it is there. What the Amendment makes clear is that it is letting value on the terms of the tenancy. It does not mean the artificial letting value for rating purposes which, as I pointed out, was applied in a very unrealistic way in earlier rating practice. It would be the actual market value of the lease on the terms of the lease at the time when the lease was granted.
That leaves me to the point about time raised by the hon. Member for Crosby (Mr. Graham Page). I think that the

1587
wording of the Amendment is quite clear. It says that it
"… shall not be regarded as a tenancy at a low rent if at the commencement of the tenancy the rent payable under the tenancy exceeded two-thirds of the letting value …".
It is at the commencement of the tenancy that one has to compare the two factors. One could only do that by taking the letting value at that date, and I am satisfied that that is what the words mean.
Question put and agreed to.
Subsequent Lords Amendments agreed to.

Clause 9.—(PURCHASE PRICE AND COSTS OF ENFRANCHISEMENT, AND TENANT'S RIGHT TO WITHDRAW.)
Lords Amendment No. 15: In page 13, line 41, leave out "but".
Mr. Skeffington: I beg to move, That this House doth agree with the Lords in the said Amendment.
Perhaps, Mr. Deputy Speaker, I may refer not only to this Amendment but to Amendments Nos. 16, 18, 19 and 54. They are all directed to the same point, and I think that the whole series will commend itself to the House.
Mr. Deputy Speaker: If the House agrees, so be it.
Mr. Skeffington: Amendments 15 and 16 are directed, as are the other Amendments, to a point raised by the Law Society. Clause 9(1,a) as now drafted provides what the price of enfranchisement is to be. This is the market price of the freehold property, subject to the 50-year extension. Some ingenious minds—and, indeed, those familiar with valuation practice—have suggested that the very right of enfranchisement itself might act as a depressant, or, even before the valuation started, a factor that might be thought to be taken into account. With the insertion of the words
"but on the assumption that this Part of this Act conferred no right to acquire the freehold"
there cannot be a vicious circle of this type. I am advised that it is highly unlikely that the Lands Tribunal would have accepted that ingenious suggestion, but it has been thought better to provide against the possibility now in this way.
Turning to Amendment No. 18, a similar point suggested by the Law
1588
Society is that it is always been implicit—and we have stated this, and I think that it has been generally accepted—that the leaseholder's right to extend the lease is subject to the landlord's right to terminate the lease for redevelopment during the period of the extension. Amendment No. 18 makes explicit and clear beyond doubt what was implicit and, I think, understood.
As at present drafted subsection (1,a) is open to the possible interpretation that if the lease had not already been extended the right to extend it could be treated as though it had been exhausted. This was never the Government's intention, nor do I believe that anyone has ever suggested that it would be fair and proper. Amendment No. 19 deals with that point. In passing I may say that Amendment No. 54, which I will move in due course, deals with a similar point with regard to Schedule 2, where a qualified leaseholder who has put in a claim for extension at the end of the lease is required to give up possession under Clause 17 or Clause 18—the redevelopment Clauses. An ambiguity exists here which, perhaps cannot be cleared up unless we leave out the words "had been" and insert "was to be" in Schedule 2.
I commend these Lords Amendments to the House.
Mr. Graham Page: The Parliamentary Secretary has put the Amendments as being, perhaps, merely drafting Amendments, but I should have liked him to have explained what effect they might have on the development value within the purchase price. These Amendments—Amendment No. 16, for example—make it quite clear that one assumes in ascertaining the price that there is a freehold to be valued—a freehold subject to an existing lease and subject to an extended lease. One must disregard the fact that the lessee has any particular right to acquire that extension. Amendment No. 16 values it merely as though the purchaser is a stranger—I assume that to be the intention. This means that someone is buying freehold land subject to a lease which can be determined at any moment for the purpose of development. When it is determined at any moment by the landlord for the purpose of development the landlord has to pay a certain sum in compensation for it.

1589
We have never yet been able to discover clearly from the Bill itself whether or not that sum then paid includes the development value of the property, so one goes back to the original scheme in Clause 9(1,a)—the formula for the price.
Does the tenant pay for the development value of the property or the land at that time, and then, if the landlord decides to develop, does he get that compensation back again? Or is that development value cut out of both transactions, in which case it would be all right? If it is cut out of both transactions or included in both transactions that is quite correct. But might it, by Amendment No. 16, be excluded in the first transaction and included in the second transaction, so that when calculating the compensation for the landlord one disregards the development value, the planning consents and so on that the property has, and values it just as a piece of land with no value at all, but when the landlord wants to get the use of the land back again for development, does he have to pay development value for doing so?
This point arises directly on these Amendments, particularly because in Amendment No. 18 the words have been inserted to make quite clear that we are to assume that the extended lease is subject to the landlord's rights under Clause 17, that is to say, we are to assume that this is a lease under which the landlord can get his property back. This is a very different valuation from a lease which is bound to last for 50 years and there is no right for the landlord to get the property back. The property has to be subject to a lease which can be terminated by the landlord. The query I have is, will the landlord then have to pay development value, or does he get out of paying that development value? The answer to that question will affect the valuation arising out of the assumption we are asked to make in Amendment No. 16.
I trust that I have not confused the Joint Parliamentary Secretary too much. I admit that I am confused myself because we are faced with two or three Amendments to a formula which has been amended time and again as we have
1590
gone along yet we have never had an explanation of how the formula affects the development value of the property.
Mr. MacDermot: Perhaps I may try to assist the hon. Member. In a case where the tenant enfranchises and acquires the property he does so and pays a price on the basis of the assumption made in the Bill. That assumption of the extended lease takes into account the right of a landlord to re-possess for redevelopment This will ensure—this is a point on which the Law Society was worried—that an enfranchising leaseholder does pay for the development value, if any, in the price.
Point No. 2 is where there is no enfranchisement but an extension of the lease. The landlord then does exercise his right to re-possess for the purpose of redevelopment. What does he have to pay? I think the question which is troubling the hon. Member is, does he have to pay anything for redevelopment value? The answer is "no", because that leaseholder has not acquired development value. All he has acquired is a right to an extended lease, a 50 years' lease, of bricks and mortar value. The landlord has to pay him out for that, but for nothing else. He does not have to pay for development value.
Mr. Graham Page: Before the hon. and learned Gentleman sits down, may I compliment him on that explanation which is the clearest explanation we have had on this Bill?
Question put and agreed to.
Subsequent Lords Amendment agreed to.
Lords Amendment No. 17: In page 13, line 41, after "tenancy" insert:
";and on the assumption that, during the period commencing on the date 25 years before the original term date, or at the relevant time (whichever is the later), and ending on the original term date, the rent payable under the tenancy was to be the letting value at the commencement of that period ascertained in accordance with section 15(2)(a) below;"
8.15 p.m.
Mr. MacDermot: I beg to move, That this House doth disagree with the Lords in the said Amendment.
This Amendment is virtually identical with one which was put down by hon. Members opposite for Report, but not

1591
moved. Perhaps it was not called. Its effect is that the price of enfranchisement would be calculated on the assumption that the leaseholder has an extended lease but is liable to pay a modern ground rent from a date 25 years before the original term date or, if it be later, from the date of the service of his notice.
The result would be that the price of enfranchisement would be based on an up-to-date site value if the leaseholder were enfranchised during the last 25 years and would more nearly reflect that value if he were enfranchised earlier. In all the arguments we have had—and there have been many—about what should be the price for enfranchisement, I do not think that until this Amendment anyone has suggested that the price should be higher than the existing market value of the reversion, but this is what this ingenious Amendment would achieve, perhaps unwittingly.
The results would be somewhat curious if we take the case of an ordinary 99-year lease. For the first 40 years or so, about the first third of the lease anyway, the effect would be very slight because there would be so much of the lease remaining and it would be only the last 25 years which would be affected. The effect on the value of the lease and on the enfranchisement price would be marginal, but, during the period when there are about 60 to 25 years to run, the position would be that the enfranchising leaseholder would pay more than he has to pay under the present law or under a present agreement for the enfranchisement at full market value of the landlord's interest. For the last 25 years of the term the terms of the existing tenancy would he swept away completely and the leaseholder would pay the terminal site value, or something very near to it.
Apart from this objection, which certainly from the point of view of hon. Members on this side of the House would be quite fatal to the Amendment, there would be a further disadvantage in that it would discourage leaseholders from enfranchising until the very last years of the term. I do not think it would be to anyone's advantage and it might be worse from the landlord's point of view as he would be kept in suspense longer. Furthermore, it would hit the leaseholder hardest at the time when he is most vul-
1592
nerable, when the lease has 30 years or so to run. For these reasons, I advise the House to reject the Lords Amendment.
Mr. Graham Page: The reason behind this Amendment, if I understand it correctly, is that in calculating the compensation we should look to the value of the asset which the tenant acquires rather than the value which is taken away from the landlord. The hon. and learned Gentleman said that this Amendment would sweep aside the terms of the lease—this from hon. Members opposite who are sweeping aside the terms of the whole of these leases. If they are doing that they should consider the proper compensation to be paid by the person who is gaining from it.
This Amendment would look to the value of the property in the hands of the tenant rather than the value of it as taken from the landlord because the tenant is being given the benefit of the Act. He is getting the house without payment. Therefore, he should pay for what he is getting in the land itself. What he is getting is the right, if he chooses, to relet that land on a long lease at an improved ground rent. It is that which their Lordships who introduced the Amendment wished to be taken into account rather than the value of the ground rent as taken away from the landlord.
There seems to be no reason why this should result in something higher than market value. I do not know whether the hon. and learned Gentleman was considering the market value of the whole property, the land and the house. I would not have thought that an occasion could arise where the formula set out in the Amendment could result in a price higher than the market value of the land and the house. If it did, there would be no harm in limiting it to that amount. That is what the Government should have secured by tabling an Amendment to the Lords Amendment.
The difficulty about taking a broad Amendment without any limitation as to the 25 years which appears in the Amendment is that that would undoubtedly delay the tenant's giving notice. It would also give great advantage to the tenant who had a longer time to run on his existing lease. Therefore, to make it fair, the 25 years was taken in judging the ground rent over that period.

1593
It is no answer to say that this would sweep aside the terms of the lease and disregard the ground rent under the existing lease. Of course it does. We are disregarding the whole lease under the provisions of the Bill. What we are looking for in the Amendment is fair compensation for what the tenant will receive. The Amendment recognises the principles of the Bill, however much we may disagree with them—the principle that the tenant owns the bricks and mortar and that he must pay only for the land. In fact, he is not paying for the land under the formula set out in subsection (1,a). He is not paying the value of the assets he is getting. He would be paying a reasonable sum for it—not paying for the bricks and mortar, but just paying for the reasonable value of his land when it gets into his hands—if the formula in the Amendment were adopted. A tenant who is getting all the benefits to be conferred by the Bill—his house free of any payment—should at least pay a fair sum for the land which he is acquiring.
Question put, That this House doth disagree with the Lords in the said Amendment:—
The House proceeded to a Division—
Mr. MacDermot(seated and covered): Mr. Deputy Speaker, I am informed that some of the police officers in the building have been calling a Count. This is a Division. I do not know whether in these circumstances you would think it right to call this Division off and to call a second Division.
Mr. Deputy Speaker: I am much obliged to the hon. and learned Gentleman. In these circumstances I propose
to call this Division off and to put the Question again.
Question put, That this House doth disagree with the Lords, in the said Amendment:—
The House proceeded to a Division—
8.30 p.m.
The Parliamentary Secretary to the Treasury (Mr. John Silkin)(seated and covered): On a point of order, Mr. Deputy Speaker. I understand that when you gave instructions that the first Division was to be called off and the Question was to be put again, unfortunately a large number of hon. Members had already gone through the Lobbies and had, in fact, already been counted. In the circumstances, I am wondering whether the correct procedure might be now to call the present Division off and to start again and clear the Lobbies.
Mr. Deputy Speaker: I must apologise to the House if there has been any confusion as a result of the faulty ringing of the bells. I think that in the circumstances the right course would be for me to order the doors to be locked—"Lock the doors"—and then for the Lobbies to be cleared and for the Division to start afresh. I do not think I can put the Question again until the Lobbies have first been cleared. I will direct the Lobbies now to be cleared, and then in a few minutes I will put the Question again.
Question put, That this House doth disagree with the Lords in the said Amendment:—
The House divided: Ayes 176, Noes 95.

Division No. 494.]

AYES

[8.35 p.m.

Alldritt, Walter

Brown, Bob (N'c'tle-upon-Tyne, W.)

Davies, Ednyfed Hudson (Conway)

Allen, Scholefield

Buchan, Norman

Davies, Harold (Leek)

Anderson, Donald

Buchanan, Richard (G'gow, Sp'burn)

Davies, Ifor (Gower)

Archer, Peter

Cant, R. B.

Davies, S. O. (Merthyr)

Atkins, Ronald (Preston, N.)

Carter-Jones, Lewis

Dempsey, James

Atkinson, Norman (Tottenham)

Chapman, Donald

Dewar, Donald

Bacon, Rt. Hn. Alice

Coe, Denis

Dickens, James

Bagier, Gordon A. T.

Coleman, Donald

Dobson, Ray

Barnett, Joel

Conlan, Bernard

Doig, Peter

Beaney, Alan

Corbet, Mrs. Freda

Dunnett, Jack

Bidwell, Sydney

Craddock, George (Bradford, S.)

Dunwoody, Mrs. Gwyneth (Exeter)

Binns, John

Crawshaw, Richard

Edelman, Maurice

Blackburn, F.

Cullen, Mrs. Alice

Edwards, Rt. Hn. Ness (Caerphilly)

Booth, Albert

Dalyell, Tam

Edwards, William (Merioneth)

Boston, Terence

Davidson, Arthur (Accrlngton)

Ellis, John

Braddock, Mrs. E. M.

Davies, Dr. Ernest (Stretford)

Ensor, David

Brooks, Edwin

Davies, G. Elfed (Rhondda, E.)

Evans, Ioan L. (Birm'h'm, Yardley)

Finch, Harold

Leadbitter, Ted

Shaw, Arnold (Ilford, S.)

Fitch, Alan (Wigan)

Lewis, Arthur (W. Ham, N.)

Sheldon, Robert

Fletcher, Ted (Darlington)

Loughlin, Charles

Short, Mrs. Renée (W'hampton, N. E.)

Foot, Michael (Ebbw Vale)

MacDermot, Niall

Silkin, Rt. Hn. John (Deptford)

Ford, Ben

Macdonald, A. H.

Silkin, Hn. S. C. (Dulwich)

Freeson, Reginald

McGuire, Michael

Silverman, Julius (Aston)

Galpern, Sir Myer

Mackenzie, Alasdair (Ross & Crom'ty)

Silverman, Sydney (Nelson)

Gardner, Tony

Mackintosh, John P.

Skeffington, Arthur

Garrett, W. E.

McMillan, Tom (Glasgow, C.)

Slater, Joseph

Gourlay, Harry

Mahon, Peter (Preston, S.)

Small, William

Greenwood, Rt. Hn. Anthony

Manuel, Archie

Spriggs, Leslie

Gregory, Arnold

Mapp, Charles

Summerskill, Hn. Dr. Shirley

Grey, Charles (Durham)

Marquand, David

Swain, Thomas

Griffiths, David (Rother Valley)

Mellish, Robert

Symonds, J. B.

Griffiths, Rt. Hn. James (Llanelly)

Mendelson, J. J.

Tinn, James

Griffiths, Will (Exchange)

Miller, Dr. M. S.

Tomney, Frank

Grimond, Rt. Hn. J.

Milne, Edward (Blyth)

Urwin, T. W.

Hale, Leslie (Oldham, W.)

Mitchell, R. C. (S'th'pton, Test)

Varley, Eric G.

Hamilton, James (Bothwell)

Morgan, Elystan (Cardiganshire)

Wainwright, Edwin (Dearne Valley)

Hamling, William

Morris, Alfred (Wythenshawe)

Wainwright, Richard (Colne Valley)

Harrison, Walter (Wakefield)

Neal, Harold

Walden, Brian (All Saints)

Haseldine, Norman

Norwood, Christopher

Walker, Harold (Doncaster)

Heffer, Eric S.

O'Malley, Brian

Waliace, George

Hilton, W. S.

Orme, Stanley

Watkins, Tudor (Brecon & Radnor)

Hooley, Frank

Oswald, Thomas

Weitzman, David

Hooson, Emlyn

Owen, Will (Morpeth)

Wellbeloved, James

Horner, John

Padley, Walter

Whitaker, Ben

Howarth, Harry (Wellingborough)

Page, Derek (King's Lynn)

White, Mrs. Eirene

Howarth, Robert (Bolton, E.)

Pannell, Rt. Hn. Charles

Whitlock, William

Howie, W.

Park, Trevor

Wilkins, W. A.

Huckfield, Leslie

Parkyn, Brian (Bedford)

Willey, Rt. Hn. Frederick

Hughes, Emrys (Ayrshire, S.)

Pavitt, Laurence

Williams, Alan (Swansea, W.)

Hughes, Hector (Aberdeen, N.)

Pearson, Arthur (Pontypridd)

Williams, Clifford (Abertillery)

Hughes, Roy (Newport)

Pentland, Norman

Wilson, William (Coventry, S.)

Hunter, Adam

Perry, George H. (Nottingham, S.)

Winnick, David

Jackson, Peter M. (High Peak)

Price, Thomas (Westhoughton)

Winstanley, Dr. M. P.

Janner, Sir Barnett

Price, William (Rugby)

Winterbottom, R. E.

Jeger, Mrs. Lena (H'b'n & St.P'cras, S.)

Probert, Arthur

Woodburn, Rt. Hn. A.

Johnson, Carol (Lewisham, S.)

Rhodes, Geoffrey

Yates, Victor

Jones, Dan (Burnley)

Robinson, W. O. J. (Waith'stow, E.)

Jones, J. Idwal (Wrexham)

Rogers, George (Kensington, N.)

TELLERS FOR THE AYES:

Jones, T. Alec (Rhondda, west)

Rowlands, E. (Cardiff, N.)

Mr. Joseph Harper and

Kerr, Russell (Feitham)

Ryan, John

Mr. Neil McBride.

NOES

Allason, James (Hemel Hempstead)

Heseltine, Michael

Pearson, Sir Frank (Clitheroe)

Astor, John

Hiley, Joseph

Percival, Ian

Awdry, Daniel

Hogg, Rt. Hn. Quintin

Pink, R. Bonner

Body, Richard

Holland, Philip

Pounder, Rafton

Brinton, Sir Tatton

Hordern, Peter

Price, David (Eastleigh)

Brown, Sir Edward (Bath)

Hornby, Richard

Prior, J. M. L.

Bullus, Sir Eric

Hunt, John

Pym, Francis

Clegg, Walter

Iremonger, T. L.

Quennell, Miss J. M.

Cooke, Robert

Irvine, Bryant Godman (Rye)

Renton, Rt. Hn. Sir David

Cooper-Key, Sir Neill

Jennings, J. C. (Burton)

Rippon, Rt. Hn. Geoffrey

Cordle, John

Jopling, Michael

Rodgers, Sir John (Sevenoaks)

Costain, A. P.

Lancaster, Col. C. G.

Rossi, Hugh (Hornsey)

Craddock, Sir Beresford (Spelthorne)

Lane, David

Royle, Anthony

Dalkeith, Earl of

Lloyd, Rt. Hn. Selwyn (Wirral)

Russell, Sir Ronald

Dance, James

Loveys, W. H.

Shaw, Michael (Sc'b'gh & Whitby)

Digby, Simon Wingfield

McMaster, Stanley

Silvester, Fred (Walthamstow, W.)

Elliot, Capt. Walter (Carshalton)

Maddan, Martin

Smith, John

Elliot, R. W. (N'c'tle-upon-Tyne, N.)

Maginnis, John E.

Stodart, Anthony

Errington, Sir Eric

Maude, Angus

Summers, Sir Spencer

Farr, John

Maxwell-Hyslop, R. J.

Taylor, Frank (Moss Side)

Fletcher-Cooke, Charles

Mills, Stratton (Belfast, N.)

Thatcher, Mrs. Margaret

Foster, Sir John

Miscampbell, Norman

van Straubenzee, W. R.

Gibson-Watt, David

Mitchell, David (Basingstoke)

Walker-Smith, Rt. Hn. Sir Derek

Grant-Ferris, R.

Monro, Hector

Ward, Dame Irene

Gresham Cooke, R.

Montgomery, Fergus

Weatherill, Bernard

Grieve, Percy

More, Jasper

Webster, David

Gurden, Harold

Morgan, Geraint (Denbigh)

Wills, Sir Gerald (Bridgwater)

Hall-Davis, A. G. F.

Murton, Oscar

Worsley, Marcus

Harris, Frederic (Croydon, N.W.)

Nabarro, Sir Gerald

Younger, Hn. George

Harrison, Col. Sir Harwood (Eye)

Osborn, John (Hallam)

Hawkins, Paul

Osborne, Sir Cyril (Louth)

TELLERS FOR THE NOES:

Hay, John

Page, Graham (Crosby)

Mr. Anthony Grant and

Heald, Rt. Hn. Sir Lionel

Page, John (Harrow, W.)

Mr. Timothy Kitson.

Sir Derek Walker-Smith: On a point of order, Mr. Deputy Speaker. Before we proceed with these important deliberations, are we to be vouchsafed any explanation of the curious circumstances which led to so many of us being shut up in the Lobby for so long?
Mr. Deputy Speaker: I have caused inquiries to be made as to what happened when the bells inadvertently rang for a Count instead of for a Division.
Sir D. Walker-Smith: Further to that point of order, Mr. Deputy Speaker. As your announcement was that there was a Division, can you tell the House from what time the necessary minutes started to be counted? Presumably it was from immediately the erroneous signal was corrected to the right one. But in spite of that we seemed to be kept in the Division Lobby far longer than would be justified by that particular matter.
8.45 p.m.
Mr. Deputy Speaker: I have already expressed my regrets to the House for any inconvenience that was caused to right hon. and hon. Members. As I understand the position at the moment—I am still awaiting a full explanation—when I first called the Division by some inadvertence the bells sounded for a Count and an announcement to that effect was made, with the result that a number of hon. Members, but not all, thought that there was a Count and not a Division. Some hon. Members went through the Lobby under the impression that there was a Division, and on the second occasion when a Division was called some hon. Members thought that having been through the Division Lobby once there was no need for them to go through again. Therefore, so that the matter could be regularised I ordered the Division Lobbies to be cleared and the Division to be started afresh.
Mr. Michael Foot: Further to that point of order, Mr. Deputy Speaker. Can those of us who have voted four times now go home?
Sir D. Walker-Smith: I am very much obliged to you, Mr. Deputy Speaker, for that clear and candid explanation of these peculiar circumstances. I certainly did not raise the question in any spirit of criticism. After all, to err is human,
1598
as we are constantly reminded by the presence of the Government Front Bench. It is, after all, a very suitably confusing end—though it is not quite the end—to a very confusing Bill.
Mr. Michael Jopling: Further to that point of order, Mr. Deputy Speaker. As you have said that you will institute an inquiry about what went wrong, may we take it that you will make a statement to the House tomorrow about what has happened?
Mr. Deputy Speaker: I do not think that that would be in accordance with precedent.
Dame Irene Ward: It would be a good idea.
Subsequent Lords Amendment agreed to.

Clause 11.—(EXONERATION FROM, OR REDEMPTION OF, RENTCHARGES ETC.)
Lords Amendment No. 20: In page 18, line 27, leave out "(c), (5)" and insert "(b) and (c)".
Mr. Skeffington: I beg to move, That this House doth agree with the Lords in the said Amendment.
This is a drafting Amendment. What is now paragraph (b) in Clause 4(1) was inserted during the Report stage, and it now requires us to renumber in the way suggested the paragraphs in Clause 4.
Question put and agreed to.

Clause 12.—(DISCHARGE OF MORTGAGES ETC. ON LANDLORD'S ESTATE.)
Lords Amendment No. 21: In page 21, line 9, at end insert:
"Provided that this subsection shall not have effect in relation to a charge in favour of trustees for debenture holders which at the date of the conveyance to the tenant is (as regards the house and premises) a specific and not a floating charge."
Mr. MacDermot: I beg to move, That this House doth agree with the Lords in the said Amendment.
Clause 12 provides in general for the automatic discharge of mortgages and such other charges on the landlord's estate by the conveyance itself of the freehold to the leaseholder, subject to the tenant's applying the price payable

1599
in the first instance in or towards the redemption of the mortgage.
Subsection (5) of the Clause contains an exception to this general rule in that it excludes all charges which are secured by a series of debentures, and in the result the tenant is not required to pay the price for enfranchisement to the debenture holders as he would otherwise have to do.
What the Amendment does is to refine this exception by restricting it to debentures which create a floating charge, leaving any fixed charge on the assets of the company to be dealt with by the general rule. The point is that debentures

Clause 14.—(OBLIGATION TO GRANT EXTENDED LEASE.)

Lords Amendment No. 22: In page 24,1ine 33, at end insert—

"(5A) Where under a lease executed to give effect to this section the new tenancy takes effect subject to a subsisting charge on the existing tenancy, and at the time of its execution the person having the charge is by reason thereof entitled to possession of the documents of title relating to the existing tenancy, then he shall be similarly entitled to possession of the documents of title relating to the new tenancy and the tenant shall within one month of the execution of the lease deliver it to him, and the instrument creating or evidencing the charge shall apply in the event of the tenant failing to deliver the lease in accordance with this subsection as if the obligation to do so were included in the terms of the charge as set out in that instrument."

Read a second time.
Mr. Allason: I beg to move, as an Amendment to the Lords Amendment, in line 7, to leave out from second 'the' to 'and' in line 8 and to insert:
'landlord shall deliver to that person the instrument creating the new tenancy'.
Mr. Deputy Speaker: We can discuss at the same time the following Amendment to the Amendment, also standing in the name of the hon. Member for Hemel Hempstead (Mr. Allason)—in line 10, leave out 'deliver' and insert 'secure the delivery of'.
Mr. Clegg: The noble Lord, Lord Kennet, in another place, introducing the Government's Amendment, said that the motive was the concern expressed by building societies which had taken retail property as a security that they should get their hands on the new and extended lease, and we welcome in general this new provision in that it seeks to protect the mortgagee.
bentures in the form of a fixed charge are for all practical purposes indistinguishable from an ordinary mortgage, and it is, therefore, sensible that they should be dealt with under the general rule.
Mr. Rossi: On behalf of my right hon. and hon. Friends, I thank the hon. and learned Gentleman for this concession. The matter was pressed hard in Committee and again on Report stage and we were given an undertaking that it would be remedied in another place. We are grateful that the Government have made this small but valuable concession to this side of the House.
Question put and agreed to.
However, we are concerned about the position. As I understand the new provision, there is an obligation on the tenant to hand over the new lease within one month of its execution by the landlord but what happens if the tenant fails to do this and, having failed to do so, should sell the extended lease, which would be assigned to a purchaser without notice of the mortgage? What would be the position of the mortgagee in these circumstances? Is his only remedy then to sue the mortgagor under the covenant contained in the original mortgage?
If the mortgage were protected by the deposit of the original lease, there would be no registration and any purchaser from the tenant of the extended lease would not know of the legal charge affecting it. In these circumstances, it would seem that the mortgagee would be left with very poor remedy if his only remedy lay under the covenant contained in the original deed.
This is why we suggest that the new document should be handed over to the

1601
mortgagee, not by the tenant but by the landlord. This would mean that there would be no possibility of the tenant disposing of his new lease since, of course, he would not have the document in his possession to make title. We would appreciate it if the Government would tell us whether there are sanctions other than those contained in the new provision contained in the Lords Amendment.
Mr. Skeffington: In replying to the hon. Gentleman, perhaps I can relate my comments also to the Lords Amendment which, in due course, I shall ask the House to agree to. The position under this Clause is well known to hon. Members who served on the Standing Committee and certainly to those who practice in this branch of the law. The building societies were concerned that a leaseholder whose lease was subject to a mortgage might obtain an extended lease without the mortgagee being brought into the matter and fail perhaps to hand over the new lease to the mortgagee. This could make for difficulty if the mortgagee subsequently had to foreclose or sell the house.
The new subsection makes it clear that whenever a mortgagee has possession of the title deeds relating to the original tenancy he is to be similarly entitled to the deeds relating to the new tenancy, and imposes upon the leaseholder a duty to hand over the new lease to the mortgagee within one month of its being executed. That is the clear obligation which is placed upon the leaseholder.
It can be regarded as a corollary to subsection (5) which already makes a similar provision—[Interruption.]
Mr. Deputy Speaker: Order. I do not want to interrupt the hon. Member, but I should point out that if he is proposing now to deal with the Lords Amendment as well as the Amendment moved by the hon. Member I do not think we can have a second debate on the Lords Amendment. It might well be for the convenience of the House if the two were discussed at the same time and if that is the wish of the House, so be it.
Mr. Skeffington: I have virtually finished this part of the explanation. I will come to the hon. Gentleman's Amendment and then, if there is any
1602
further point, perhaps, with leave, I could speak again. However, I have virtually come to the hub of my explanation as to why the Opposition Amendment would not do. What we have done may be regarded as a corollary to subsection (5), with which the House is familiar. The Amendments proposed to line 7 and line 10 will not do, because the landlord may not know that the lease is subject to a mortgage and he has no means of finding out except by inquiry of the tenant, who will not disclose the charge to the landlord if he intends to conceal it in dealings with other people. It would, therefore, be unfair to expose the landlord to an action for damages by the mortgagee for a breach of this duty. If it is not intended that the landlord should be so exposed, there is no point in imposing the duty on him in addition to the duty on the tenant. The same objections apply to putting a duty on the landlord to draw the lease subject to a subsisting charge about which he may be ignorant. In view of the clear obligation which the new subsection puts upon a tenant, we feel that this is an adequate safeguard and we would be exposing the landlord to a peril which would be most unfair, because in many cases he would not have any means of checking the facts.
Mr. Graham Page: Surely the tenant will have to disclose the title to his existing tenancy to the landlord when he applies for the extended tenancy. Without being able to put my finger on it in the Bill, I thought it was the obligation of the tenant to disclose encumbrances on his existing tenancy so that the surrender of that and the granting of the new tenancy would be made. If not, I imagine that such a thing will be included in the Lord Chancellor's conditions which are to be made by Regulation. At any rate, it would be the normal thing for the tenant to disclose the encumbrances on the existing lease, including perhaps the mortgage which takes effect upon the new lease.
This is the background to the Amendments which my hon. Friend has moved: that there is an existing tenancy, the tenant has given notice that he requires an extended lease instead of taking the freehold, and the existing tenancy is subject to a mortgage. In the very first few lines of the Lords Amendment that

1603
we are seeking to agree here there is reference to the new tenancy taking effect subject to a subsisting charge on the existing tenancy. The normal thing would be that when that transaction is completed, the landlord's solicitor hands over the new lease to the tenant or the tenant's solicitor.
The only obligation placed on the tenant under the Lords Amendment is that within a month he shall deliver that document of title to his mortgagee. But what may he do with it in that month? This is our difficulty. The normal practice would be for the landlord when granting a new lease when another has been surrendered to hand over to the mortgagee who is entitled to this document of title. All we are proposing in the Amendment is that the normal practice should be observed and that the possibility of the fraudulent tenant avoiding handing his deeds to his mortgagee should be short circuited by saying that the landlord shall do it on completion of the transaction.
9.0 p.m.
Mr. Rossi: What would be the position of a tenant who acted fraudulently in the intervening period of one month? If he had the new lease in his possession, apparently uncharged, could he not seek to borrow money from another person? Would there not then be a terrible conflict between a person who lent on the old lease which had expired and which was still subject to the charge and the new person who had unwittingly lent money on the new lease? What would be the security and who would have the security for the prospective sums borrowed?
Another situation could be for the tenant to sell his lease very quickly. The purchaser would get a good title and the money would pass into the pocket of the fraudulent tenant and the mortgagee could be left whistling for his money. These are practical difficulties which could arise and one would want the Bill to be sewn up so that we do not give opportunities of that kind.
Mr. Skeffington: I do not think that the hon. Member for Crosby (Mr. Graham Page) is correct in saying that there is an obligation in the Bill in relation to encumbrances.
1604
One appreciates the difficulties and the existing practice and one has discussed this matter with the building societies and others to see whether any further obligation could be placed. They were satisfied that the new Clause 5(a) met the difficulty in placing this obligation. Of course it is always possible for any one not to comply with the obligations of the law, but it was felt that now that we have made it clear that whenever a mortgagor has possesison of the title deeds relating to the original tenancy he is similarly entitled to the deeds relating to the new tenancy and imposing on the leaseholder the strict obligation to hand over within one month of a new lease being executed covered the position. No doubt those advising will see that this is done, because the position of the leaseholder could obviously be extremely precarious if this obligation were not complied with.
It was suggested that the time might be too short, but it was felt that this was adequate time and that if the period were made too long, that would lead to further difficulties. Furthermore, this period is in parallel with that in the main provision to which the House has agreed previously.
Mr. Rossi: What is the sanction? If this is not done within one month, what is the sanction of law imposed on the tenant? I do not recall seeing a penalty spelled out in some other provision. How can this requirement be enforced?
Mr. Skeffington: The whole of the leaseholder's position would be at stake if he had not complied with this provision and that is a very powerful sanction.
Amendment negatived.
Lords Amendment agreed to.

Clause 15.—(TERMS OF TENANCY TO BE GRANTED ON EXTENSION.)
Lords Amendment No. 23: In page 25, line 25, leave out from "of" to "shall" in line 27, and insert
"each period of ten years after the original term date the letting value at the expiration of that period".
Mrs. White: I beg to move, That this House doth disagree with the Lords in the said Amendment.
It might be for the convenience of the House if I gave reasons why it should

1605
also disagree with the Lords Amendments, in page 25, line 30, leave out "either" and insert "each"; in line 33, leave out "by" and insert "equally by the landlord and"; and in line 35, leave out "of the twenty-five," and insert "year of any period of ten".
Mr. Deputy Speaker: If the House agrees, so be it.
Mrs. White: The purpose of this Amendment and the others, which are consequential upon it, is to ensure that if a tenant should apply for and obtain an extended lease, the amount of ground rent payable, which is to be a modern ground rent in the first instance, not the old ground rent of the former leases, should naturally be determined at the initial period of the new lease.
It was felt that the 50 year extension which was available under this provision was perhaps rather long in terms of modern devaluation of the currency and that it was fair to the landlord to suggest that half way through the period there should be an opportunity for a revision of the rent. The Amendment suggests that the 25 year period proposed is too long and that instead of one revision after the initial one there should be revision every ten years.
When we originally discussed this matter, an even shorter period of seven years was suggested. This seemed entirely out of keeping with the spirit of the proposals in the Bill. I do not think that ten years is any great improvement. We still think that it is quite unreasonable for a revaluation of the rent. I would remind the House that if one looks a little further down in Clause 15 one will see that what we ale discussing under these Amendments is rent pure and simple.
Where other charges are concerned, in subsection (3), either for services, or for repairs, maintenance or insurance, there are separate arrangements, whereby these charges can be dealt with more quickly. It is only the ground rent that is the subject of these Amendments. It is true that there is a slight palliative in suggesting these extra valuations. Amendment No. 25 proposes that instead of making the tenant responsible for the entire cost of the valuation, and one would be increasing the number of valuations from
1606
two to five, one should arrange for this cost to be shared with the landlord.
This is a slight disadvantage to the tenant, who would have to pay two and a half instead of two valuations. One would not say that it was a matter of great principle, that one would necessarily regard that as being conclusive, but it is nevertheless a slight disadvantage to the tenant. The main argument against this proposition, however, is that if one is to have so many valuations, one will not merely increase the expense but also the work. We are frequently told that we are short of good valuers, and it is really, to our mind, against public policy, that one should suggest that one would need so many valuations in the course of a 50 year tenancy.
All that we are discussing is the ground rent. I repeat that there are other arrangements for all other charges which may go up. We do not think that a landlord would display very much business acumen if he could not reasonably work out 25 years ground rent. He has the chance to revise. At the beginning the new extension would be set at the current market rate and we cannot see adequate arguments for adding to the tenant's uncertainty and causing extra work in valuation for no good reason. We hope that the House will not persist with these Amendments but will disagree with their Lordships.
Mr. Allason: The right hon. Lady suggests that, when a landlord fixes a rent for the first 25 years, he should take into account the fact that it is against public policy to have frequent rent reviews and should therefore fix it high enough to avoid them. Is she saying that the rent for that period shall not be the current market rent but something midway between the current market rent at the beginning and that at the end of the period? This is what it means if she invites landlords to quote the proper rent.
Surely a landlord who started quoting a rent considerably in excess of the current value of the land would run into trouble—
Mrs. White: Perhaps I did not express myself clearly. The current market rent, if for 25 years, takes that whole situation into account, surely.
Mr. Allason: But that is what it does not do. The right hon. Lady was more

1607
robust at our last discussion when she replied to me:
"… we do not think that to revise a ground rent every seven years makes sense. Property owners should be able to foresee conditions for 25 years ahead; we are not suggesting that they should crystal gaze for as long as 50 years."—[OFFICIAL REPORT, 20th June, 1967; Vol. 748, c. 1582.]
But property owners cannot foresee conditions 25 years ahead at the moment; they know that there will be inflation and therefore they do not generally grant leases longer than seven years and usually have a rent review at the end of that period.
To suggest that they can foresee conditions and then quote current market rent is ridiculous, because that rent does not reflect inflation over the next 25 years, and Heaven knows what that will be. It can reflect only the bargain which a landlord strikes: he takes current market
rent and has to give the tenant a reasonable period—seven years—at the end of which, he realises, the value of money will have dropped.
I continue to argue that seven years is the proper time. Their Lordships have compromised between seven and 25 and settled on ten years, which at least is divisible into 50, a merit which my proposal did not have, as I admitted. The Government want to revert from ten to their wicked 25 years. These will not be freely negotiated deals, as the landlord will be compelled to grant a 25-year lease. Under the Government's proposals he will have to do it at the current market rent, which is just further evidence of the Government's zeal for expropriation.
Question put, That this House doth disagree with the Lords in the said Amendment:—
The House divided: Ayes 175, Noes 92.

Division No. 495.]

AYES

[9.15 p.m.

Allaun, Frank (Salford, E.)

Edwards, William (Merioneth)

Leadbitter, Ted

Alldritt, Walter

Ellis, John

Loughlin, Charles

Allen, Scholefield

Ennals, David

McBride, Neil

Anderson, Donald

Ensor, David

MacDermot, Niall

Archer, Peter

Evans, Gwynfor (C'marthen)

Macdonald, A. H.

Atkins, Ronald (Preston, N.)

Evans, Ioan L. (Birm'h'm, Yardley)

McGuire, Michael

Atkinson, Norman (Tottenham)

Finch, Harold

Mackenzie, Alasdair (Ross & Crom'ty)

Bacon, Rt. Hn. Alice

Fletcher, Ted (Darlington)

Mackintosh, John P.

Bagier, Gordon A. T.

Foot, Michael (Ebbw Vale)

McMillan, Tom (Glasgow, C.)

Barnett, Joel

Ford, Ben

Mahon, Peter (Preston, S.)

Bessell, Peter

Freeson, Reginald

Mallalieu, J. P. W. (Huddersfield, E.)

Bidwell, Sydney

Galpern, Sir Myer

Manuel, Archie

Binns, John

Gardner, Tony

Mapp, Charles

Blackburn, F.

Garrett, W. E.

Marquand, David

Boardman, H.

Gourlay, Harry

Mellish, Robert

Booth, Albert

Greenwood, Rt. Hn. Anthony

Mendelson, J. J.

Boston, Terence

Gregory, Arnold

Miller, Dr. M. S.

Braddock, Mrs. E. M.

Grey, Charles (Durham)

Milne, Edward (Blyth)

Brooks, Edwin

Griffiths, David (Rother Valley)

Mitchell, R. C. (S'th'pton, Test)

Brown, Bob (N'c'tle-upon-Tyne, W.)

Griffiths, Rt. Hn. James (Llanelly)

Morgan, Elystan (Cardiganshire)

Buchan, Norman

Griffiths, Will (Exchange)

Morris, Alfred (Wythenshawe)

Buchanan, Richard (G'gow, Sp'bum)

Grimond, Rt. Hn. J.

Neal, Harold

Cant, R. B.

Hale, Leslie (Oldham, W.)

Norwood, Christopher

Chapman, Donald

Hamilton, James (Bothwell)

O'Malley, Brian

Coe, Denis

Handing, William

Orme, Stanley

Coleman, Donald

Harrison, Walter (Wakefield)

Oswald, Thomas

Conlan, Bernard

Haseldine, Norman

Owen, Will (Morpeth)

Corbet, Mrs. Freda

Heffer, Eric S.

Padley, Walter

Craddock, George (Bradford, S.)

Hilton, W. S.

Page, Derek (King's Lynn)

Crawshaw, Richard

Hooley, Frank

Pannell, Rt. Hn. Charles

Cullen, Mrs. Alice

Hooson, Emlyn

Park, Trevor

Dalyell Tam

Horner, John

Parkyn, Brian (Bedford)

Davidson, Arthur (Accrington)

Howarth, Harry (Wellingborough)

Pavitt, Laurence

Davies, Dr. Ernest (Stretford)

Howarth, Robert (Bolton, E.)

Pearson, Arthur (Pontypridd)

Davies, G. Elfed (Rhondda, E.)

Howie, W.

Pentland, Norman

Davies, Ednyfed Hudson (Conway)

Huckfield, Leslie

Perry, George H. (Nottingham, S.)

Davies, Harold (Leek)

Hughes, Emrys (Ayrshire, S.)

Price, Thomas (Westhoughton)

Davies, Ifor (Gower)

Hughes, Hector (Aberdeen, N.)

Price, William (Rugby)

Davies, S. O. (Merthyr)

Hughes, Roy (Newport)

Probert, Arthur

Dempsey, James

Hunter, Adam

Rhodes, Geoffrey

Dewar, Donald

Jackson, Peter M. (High Peak)

Robinson, W. O. J. (Walth'stow, E.)

Dickens, James

Jeger, Mrs. Lena (H'b'n & St.P'cras, S.)

Rogers, George (Kensington, N.)

Dobson, Ray

Johnson, Carol (Lewieham, S.)

Rowlands, E. (Cardiff, N.)

Doig, Peter

Jones, Dan (Burnley)

Ryan, John

Dunnett, Jack

Jones, J. Idwal (Wrexham)

Shaw, Arnold (Ilford, S.)

Dunwoody, Mrs. Gwyneth (Exeter)

Jones, T. Alec (Rhondda, West)

Sheldon, Robert

Edwards, Rt. Hn. Ness (Caerphilly)

Kerr, Russell (Feitham)

Short, Mrs. Renée (W'hampton, N. E.)

Silkin, Rt. Hn. John (Deptford)

Wainwright, Edwin (Dearne Valley)

Williams, Alan (Swansea, W.)

Silkin, Hn. S. C. (Dulwich)

Wainwright, Richard (Colne Valley)

Williams, Clifford (Abertillery)

Silverman, Julius (Aston)

Walden, Brian (All Saints)

Wilson, William (Coventry, S.)

Skeffington, Arthur

Walker, Harold (Doncaster)

Winnick, David

Slater, Joseph

Wallace, George

Winstanley, Dr. M. P.

Small, William

Watkins, Tudor (Brecon & Radnor)

Winterbottom, R. E.

Spriggs, Leslie

Weitzman, David

Woodburn, Rt. Hn. A.

Summerskill, Hn. Dr. Shirley

Wellbeloved, James

Yates, Victor

Swain, Thomas

Whitaker, Ben

Tinn, James

White, Mrs. Eirene

TELLERS FOR THE AYES:

Tomney, Frank

Whitlock, William

Mr. Alan Fitch and

Urwin, T. W.

Wilkins, W. A.

Mr. Joseph Harper.

Varley, Eric G.

Willey, Rt. Hn. Frederick

NOES

Allason, James (Hemel Hempstead)

Hawkins, Paul

Pearson, Sir Frank (Clitheroe)

Astor, John

Hay, John

Percival, Ian

Awdry, Daniel

Heald, Rt. Hn. Sir Lionel

Pink, R. Bonner

Bennett, Dr. Reginald (Gos. & Fhm)

Heseltine, Michael

Pounder, Rafton

Body, Richard

Hiley, Joseph

Price, David (Eastleigh)

Brinton, Sir Tatton

Hogg, Rt. Hn. Qulntin

Prior, J. M. L.

Brown, Sir Edward (Bath)

Holland, Philip

Pym, Francis

Bullus, Sir Eric

Hordern, Peter

Quennell, Miss J. M.

Clegg, Walter

Hornby, Richard

Renton, Rt. Hn. Sir David

Cooke, Robert

Hunt, John

Rippon, Rt. Hn. Geoffrey

Cooper-Key, Sir Neill

Iremonger, T. L.

Rodgers, Sir John (Sevenoaks)

Costain, A. P.

Irvine, Bryant Godman (Rye)

Rossi, Hugh (Hornsey)

Craddock, Sir Beresford (Spelthorne)

Jopling, Michael

Royle, Anthony

Dalkeith, Earl of

Lancaster, Col. C. G.

Russell, Sir Ronald

Dance, James

Lane, David

Shaw, Michael (Sc'b'gh & Whitby;

Digby, Simon Wingfield

Loveys, W. H.

Silvester, Fred (Walthamstow, W.)

Elliot, Capt. Walter (Carshalton)

McMaster, Stanley

Smith, John

Elliott, R. W. (N'c'tle-upon-Tyne, N.)

Maddan, Martin

Stodart, Anthony

Errington, Sir Eric

Maginnis, John E.

Summers, Sir Spencer

Farr, John

Maude, Angus

Taylor, Frank (Moss Side)

Fletcher-Cooke, Charles

Maxwell-Hyslop, R. J.

Thatcher, Mrs. Margaret

Foster, Sir John

Mills, Stratton (Belfast, N.)

van Straubenzee, W. R,

Gibson-Watt, David

Miscampbell, Norman

Walker-Smith, Rt. Hn. Sir Derek

Grant, Anthony

Mitchell, David (Basingstoke)

Ward, Dame Irene

Grant-Ferris, R.

Montgomery, Fergus

Weatherill, Bernard

Gresham Cooke, R.

More, Jasper

Webster, David

Grieve, Percy

Morgan, Geraint (Denbigh)

Wills, Sir Gerald (Bridgwater)

Gurden, Harold

Murton, Oscar

Worsley, Marcus

Hall-Davis, A. G. F.

Nabarro, Sir Gerald

Younger, Hn. George

Harris, Frederic (Croydon, N. W.)

Osborn, John (Hallam)

Harris, Reader (Heston)

Page, Graham (Crosby)

TELLERS FOR THE NOES:

Harrison, Col. Sir Harwood (Eye)

Page, John (Harrow, W.)

Mr. Timothy Kitson and

Mr. Hector Monro.

Subsequent Lords Amendments disagreed to.

Clause 19.—(RETENTION OF MANAGEMENT POWERS FOR GENERAL BENEFIT OF NEIGHBOURHOOD.)
Lords Amendment No. 27: In page 32, line 11, leave out "landlord" and insert "Minister".
Mr. Skeffington: I beg to move, That this House doth agree with the Lords in the said Amendment.
Mr. Speaker: Unless there is objection, I suggest that we discuss at the same time Lords Amendments Nos. 28 to 36, inclusive.
Mr. Skeffington: That is satisfactory, Mr. Speaker.
This series of Amendments will generally commend itself to the House since there was a desire on both sides that the
1610
opportunities provided under Clause 19 for the maintenance of estates in their entirety—where there were advantages for the whole of the community for them to be preserved in that way—should apply not only on the application of the landlord.
This point was put with great force by my hon. and learned Friend the Member for Dulwich (Mr. S. C. Silkin) and the hon. Member for Hendon, South (Sir H. Lucas-Tooth) and subsequently representations were made to the Department. The hon. Member for Hendon, South came with a deputation, particularly in relation to the Hampstead Garden Surburb. To honour an undertaking given by me on the Floor of the House and by my right hon. Friend the then Minister of State in Committee, we saw whether it would be possible to introduce in another place provisions which would meet the desire of my hon. and learned Friend the

1611
Member for Dulwich, the hon. Member for Hendon, South and others.
As we said from the very beginning, intrinsically there was no objection; in fact, there was everything to be said for tenants having this opportunity, although there were greater difficulties in providing satisfactory and suitable arrangements to grant the provisions under Clause 19 to a body of representative tenants, since often they do not have the resources or knowledge of the properties concerned, in addition to there being other difficulties.
Although the provisions which we have made may not be absolutely watertight—because of the practical difficulties which I enumerated on a previous occasion—this series of Amendments was tabled in another place largely to meet the united desire of hon. Members. The most important of these Amendments—the substance of the whole change—is No. 36, which inserts a new subsection. It provides that where the Minister considers that, for any area, a certificate could be given on the application of the landlord—that is, that it is a well maintained estate and meets the characteristics enumerated elsewhere in the Clause—he may grant the certificate to a representative body of people occupying or interested in the property in the area or areas. The word "areas" is used to meet the case of Hampstead Garden Suburb, where the ownership is in two portions, one a trust and the other a company. The provision therefore makes allowance for two ownerships of that kind and it may apply to other parts of the country should an application be made.
9.30 p.m.
The Minister must be satisfied as to the bona fides of the representative body. Obviously, the normal inquiries will be made. I have expressed concern in the past about putting this into legislative form, but inquiries can be made and the Minister will have to use common sense in this matter.
The representative body can make its application alone or jointly with the landlord. It makes it if the landlord apparently does not intend to do so. The very fact that this power is now available to a group of tenants will go a long way to inducing some possible landowners who might not have been so
1612
enthusiastic because undoubtedly, if they apply, they will have very much greater influence on the scheme than if someone else did it. When a certificate is granted the representative body can apply to the High Court for approval to a management scheme and it can do so on its own or with the landlord. It can do this even if one of the other parties may not have made the application.
The court will be ready to give rights and powers to the representative body which normally it would have given to the landlord. The landlord must give his consent in relation to his freehold ownership and the representative body must then compensate the landlord for the loss of his rights if that is appropriate. The court can enable the representative body to participate in any scheme of management by the landlord. Sometimes there will be a kind of partnership between the landlord and the tenants.
It may be difficult for a representative body on an estate to draw up a scheme of management or indeed sometimes to define the boundaries and what property is within them. A group of tenants is not in the same position as the managers of an estate, but the new subsection nevertheless provides that a group of residents occupying as residential lessees shall have an opportunity of putting forward a scheme which often will help them to get a scheme of management of their own. It may be that no one will help them but the fact that they can do it will mean that the landlord will take the initiative or give his sanction.
In many of the better-managed estates, tenants desire to preserve real amenities. There are still practical difficulties in the final way in which this proposition may work out. Nevertheless, we have given it legal statutory opportunity under the Bill and I think this is a very powerful instrument for any such group. The hon. Baronet the Member for Hendon, South is sorry that he cannot be present for this part of the debate. He and Hampstead Garden Suburb feel satisfied with the length to which we have gone to meet them. I put that on record because the hon. Member expressed his regret that he could not be here. I hope that my hon. and learned Friend the Member for

1613
Dulwich will feel that we have gone as far as we can in this matter.
Mr. Graham Page: As the Joint Parliamentary Secretary knows, I have no very great faith in Clause 19. I do not think it sets out a process which is going to be of any use to landlords whose property has been enfranchised or that there will be many cases in which tenants will be prepared to take on the responsibility. However, there is no doubt that the Clause has been improved by the introduction of the subsections dealing with the taking over of these responsibilities by a representative body. My hon. Friend the Member for Hendon, South (Sir H. Lucas-Tooth) also told me that he regrets that he is not able to be present. By his proposal, put forward in this House, he set in motion for an improvement of this Clause.
I think that there will be few occasions on which a body of representatives will be prepared to form themselves into a representative body, to hand their affairs in this connection over to a committee, perhaps consisting of some of themselves and the landlord, and to be liable, personally perhaps, for the actions of this body or this committee. I imagine that they will wish to form themselves into a society or into a company with limited liability.
If I read this correctly, it will be possible for such persons to form themselves into a housing society or a housing association, or into a company limited by liability or by guarantee, or for them in some way to limit their personal liability for actions which may be done in their name by a committee. I assume that a company could be a representative body under Clause 19. I hope so, because this seems to be the practical way of doing it. We all know of many residential estates where there are private roads and common parts to be kept up and where the original estate-owner has disappeared or has not carried on the upkeep of the estate. Usually in such cases the residents form themselves into a limited liability company and make up the roads by subscription to that company, thereby saving themselves from personal liability. I assume that that sort of thing can be done in this case.
1614
I do not think that the fact that an application under Clause 19 can delay any dealings with the properties will cause any difficulty. The Clause originally provided only for an application by the landlord to keep some control of the management and development of the estate. Here the right is being given to a representative body on its own to come in and take over from the landlord. The Joint Parliamentary Secretary said that he hoped that such a body would do it jointly with the landlord. However, there is the power for the representative body to come in and to wrest power from the landlord.
I hope that the Minister, in giving his certificate, will pay regard to the rights of the landlord and to the rights of the tenant and will seek to hold the balance fairly between the two parties. It will be a grave responsibility on the Minister to investigate whether a representative body is capable of running matters or, indeed, for that matter, whether the existing landlord is capable of running them. I hope that this will not mean a great increase in staff at the Ministry.
Finally, although I have no very great faith that the Clause will be used, I think that it has been improved by these Amendments from another place.
Mr. Donald Chapman: A large part of the Bourneville Village Trust is in my constituency. The residents on that estate are very interested in Clause 19. There have been public meetings on this issue in my constituency. I am still very concerned about the effects of the Clause and about the Amendment.
My hon. Friend the Joint Parliamentary Secretary spoke of the negotiations he had had with bodies representing what might broadly be called the landlords in cases like this. Did he get assurances from them that they will not try unduly to delay these matters? They have two years in which to get the Minister's certificate and another year for the High Court to get its approval. It can be three years before enfranchisement can begin to take place on any real scale.
I am concerned about the length of time that is involved. Does it mean—this is where I come primarily to these Lords Amendments—that in a case where there is obviously undue delay by

1615
the landlord—I have no reason to think that there will be undue delay in the case of the Bourneville Village Trust, but one never knows—a representative body of tenants of the Trust could begin to get together and use this Amendment to force the hand of the Trust or the landlord? Could they begin to apply to the Minister and say, "There is so much delay on the part of the landlord in using Clause 19. In the meantime he is using the Clause to delay enfranchisement. We now as tenants wish to avail ourselves of Clause 19 in default of speedy action by the landlord and we ask you to recognise us and to set the process in motion"? If this is one result of the Amendments—to hold a pistol at the head of some of the estates to get on with the use of Clause 19 and not delay the process to its full limit—I would be glad to accept these Amendments that their Lordships have suggested.
Mr. S. C. Silkin: I congratulate their Lordships on these Amendments which seem to me to set the seal upon a Clause in which I personally have been greatly interested. I have in mind areas such as Bourneville, Hampstead and Dulwich where there are undoubted advantages in the leasehold system, and it is right that what is advantageous in them should be preserved. I am certain that this Clause has that effect.
There seemed to me at an earlier stage of the proceedings on the Bill to be a possible lacuna where one had a landlord who was not prepared to accept the obligations created by Clause 19. I do not overrate that possibility. I am not as pessimistic as the hon. Member for Crosby (Mr. Graham Page) about the operation of Clause 19 because it seems to me that the transitional period before full enfranchisement of any large estate will be so long that no landlord who is interested in preserving the value of his asset is likely to fail to take advantage of this Clause.
To say one word about the point which my hon. Friend has just made, as I see it, the real sanction of the Clause is that unless the landlord makes early application for a certificate he will find that not only have the notices been given by the lessees but that they have actually taken effct. If the landlord delays at all for any substantial period of time he will find
1616
that a great many people have already enfranchised before he is able to apply to the Minister for a certificate at all. It is only after his application has been made that the standstill is created, and even at that stage, as I understand the Clause, the serving of the notice is really as good as having the freehold. I agree with my hon. Friend that the possibility of a body of lessees—whether formed as a society or, as the hon. Member for Crosby suggested, in a company which may very well be appropriate in some cases—to have the power to step in will be a very powerful inducement to many landlords.
I should like shortly to state how I think this could happen in practice. I envisage not so much a body representing all the lessees on a very large estate taking advantage of this provision but rather the lessees on perhaps a small part of an estate which is self-contained, and that the lessees may get together and say, "We can run this small part of the estate on our own and we will proceed to ask for a certificate accordingly." In cases of that kind, it can be extremely valuable, and I am grateful to the Government for having accepted the principle of the Amendment on the matter which I moved in Committee.
Question put and agreed to.
Subsequent Lords Amendments agreed to.

Clause 20.—(JURISDICTION AND SPECIAL POWERS OF COUNTY COURT.)
Lords Amendment No. 37: In page 36, line 41, after "10" insert "or 30(1)".
9.45 p.m.
Mr. MacDermot: I beg to move, That this House doth agree with the Lords in the said Amendment.
Mr. Speaker: It is suggested that with this Amendment we take Lords Amendment No. 38, in page 38, line 25, to leave out "above" and to insert, "or 30(1) of this Act".
Mr. MacDermot: Yes, Mr. Speaker; I am much obliged. These are little more than drafting Amendments, the purpose being to make sure that the jurisdiction given to the county courts and the Lands Tribunal to settle disputes about covenants to be included in a conveyance on enfranchisement is to extend also to disputes about the exact nature of covenants

1617
reserving development rights which may be required by local authorities and others under Clause 30.
Question put and agreed to.
Subsequent Lords Amendment agreed to.

Clause 22.—(VALIDITY OF TENANT'S NOTICES, EFFECT ON LANDLORD AND TENANT ACT 1954 AND ON NOTICES TO QUIT, ETC., AND PROCEDURE GENERALLY.)
Lords Amendment No. 39: In page 39, line 42, after "premises" insert "and landlord's costs".
Mr. Skeffington: I beg to move, That this House doth agree with the Lords in the said Amendment.
Perhaps I may conveniently refer at the same time to Amendment No. 40, in page 39, line 43, after "agent" insert "or as stakeholder". These two Amendments, which are virtually drafting Amendments, meet points arising out of the consideration now being given to the content of regulations to be made by the Lord Chancellor under Clause 22(2). Amendment No. 39 ensures that, if the regulations provide for the leaseholder to pay a deposit at some stage between the service of notice to enfranchise and completion of the transaction, this deposit is to be on account of the landlord's costs as well as on account of the price. Otherwise, a landlord would not be entitled to get back his costs if the leaseholder at a later stage did not carry on with the transaction under Clause 9. This seems only fair and proper.
Amendment No. 40 recognises a point made by the Law Society, that deposits are, in modern practice, often paid to stakeholders. It will enable the Lord Chancellor to provide for payment of a deposit to a stakeholder if he so wishes.
Question put and agreed to.
Subsequent Lords Amendments agreed to.

Clause 24.—(PRESERVATION OF TRUSTS, CHARGES ETC. AFFECTING TENANT'S ESTATE.)
Lords Amendment No. 44: In page 42, line 32, leave out Clause 24.
Mr. Skeffington: I beg to move, That this House doth agree with the Lords in the said Amendment.
Clause 24 was never really necessary in the Bill since, as the hon. Member for Crosby (Mr. Graham Page) pointed out on one occasion, it only put into words what is already the legal position when there is an agreement whereby a leaseholder enlarges his leasehold interest into a freehold or negotiates a new lease in substitution for an existing lease. The Clause provided that the new freehold or substituted lease was to be subject to the same third party rights as the original lease. The third party rights would, however, merely take effect in equity; in order to perfect his title, the third party, such as a mortgagee of the leasehold interest, must apply to the court for an order providing for the legal estate in the freehold or extended leave to be vested in him, unless, as would normally happen, the leaseholder executes a further deed in his favour. Clause 24 was an attempt to have a short cut, so that the legal estate in the enlarged interest vested in the third party automatically.
But it now appears that the short cut would cause difficulties and inconvenience in registration. The Land Registry is often not in a position to investigate the leasehold title, which in a number of cases may not be registered, and so would be unable to ascertain whether or not it was mortgaged. The effect of Clause 24 might therefore have been to create errors in the register, for which the Government are financially liable. It is therefore thought better that the Clause should be removed. I am sure that the House will be glad to do that, for the Bill will thereby be shorter.
Mr. Clegg: I follow the Minister's arguments and can see the trouble that would be caused in the Land Registry, but is it absolutely certain that Clause 24 as it stood merely repeated the present law? Are there not cases where the mortgagee could not compel the mortgagor to execute a new document charging the freehold interest? Is it not possible under the law as it now stands for the lessee who buys in the freehold interest merely to leave the mortgagee to cover the leasehold interest and retain the

1619
freehold interest, without merging the two legal estates? If that is the present case, Clause 24 would go beyond the present law. Could the Joint Parliamentary Secretary explain a little further?
Mr. Graham Page: I have some further points which I should like to put to the Joint Parliamentary Secretary. We are all very pleased that the Bill can be shortened by one Clause. I wish that it could be shortened by 42 Clauses and seven Schedules so that there is no Bill at all.
The Joint Parliamentary Secretary stated that I had said at some stage that the Clause was unnecessary. I do not recall saying that. I do not think that I spoke on it in Committee. The Clause was removed in another place after only a very short debate and without really full discussion. It must have had a purpose when it was first put into the Bill, and apparently the only reason for taking it out is some inconvenience in the Land Registry. The Land Registry should meet conveyancing convenience. We should not change the law just for the sake of convenience at the Land Registry.
I am very worried about losing the Clause now, because it seemed to make provision for cases which might otherwise go by default, and a person entitled to an interest in property might lose his rights by reason of the extension of the lease. The Clause clearly says that
"the interest acquired shall be held in the same right and on the same trusts and subject to the same powers, privileges, charges, restraints and liabilities as those in, on or subject to which the tenancy was held".
What is being granted here if a tenant requires a new lease is a new title altogether, a new interest in the property. It cannot necessarily follow from that that someone who has an interest in the existing tenancy, which will be a surrendered or terminated tenancy, will be able to carry over that interest so that it becomes an interest in the new tenancy. The Clause did that for him. I cannot see what it does for him now that the Clause is removed.
We come back to the point that we were discussing earlier, for example a mortgagee whose charge on the property is intended to extend into the new lease, but he may be deprived of the benefits
1620
of that by not receiving the documents of title. Worse still, if we remove the Clause he may be deprived of his rights over the new tenancy altogether.
The Joint Parliamentary Secretary said that this was inconvenient to the Land Registry because upon registration of the new lease the Land Registry might not know to what a previous lease had been subject and, therefore, would not know what to enter in the Register in respect of the new lease. But surely this is the job of the tenant who is applying for registration of his new lease. He is under an obligation, if it is within the area of compulsory registration, to register his lease. Otherwise, it is not valid. He registers it subject to whatever restrictions may be upon it. I cannot see the real difficulty of the Land Registry in these cases, nor do I think it is a justification for removing what I should have thought was a useful Clause.
Mr. Skeffington: If we may, with permission, answer the points which have been raised, the hon. Member for North Fylde (Mr. Clegg) put the case as I should have put it originally for the Clause when it was in the Bill. There was something to be said, if it could safely be done, for automatically transferring the enlarged interest, the third party rights, in this way. That was the justification for putting the Clause in. But there are two difficulties.
It would, I think, be irresponsible for the Government, now that the matter has been brought to their attention by various interests, to embark upon a course which would probably result in errors being recorded in the Register, not only because of the Government's personal financial liability but also because of the other consequences that could flow from an incorrect registration. I think that on that ground alone the course that the Government are indicating is the right one.
But there is also the point about the third party. It seems to me that he could safeguard his position only either by applying to the court for a declaration or by the leaseholder executing a further deed in his favour. Under a Clause that we have already passed the leaseholder must now within one month transfer the new documents to the third party, the mortgagee in this case, and, therefore,

1621
the mortgagee should be fully aware of his rights. It is then open to him to protect them in one or other of the ways provided. It would be wrong if we retained this short Clause in the Bill and he thought he was protected when he might not be. Indeed, his rights might be registered incorrectly in the Register.
For all these reasons, although there are some regrets that we cannot have automatic transfer to third parties, the Government think that this is the safe and proper course to adopt.
Question put and agreed to.
It being Ten o'clock, further consideration of the Lords Amendments stood adjourned.

BUSINESS OF THE HOUSE
Ordered,
That the Proceedings on consideration of Lords Amendments to the Leasehold Reform Bill and on the Motion relating to Standing Orders (Ways and Means) may be entered upon and proceeded with at this day's Sitting at any hour, though opposed.—[Mr. Gourlay.]

LEASEHOLD REFORM BILL
Lords Amendments further considered.
LEASEHOLD REFORM BILL

  Clause 29.—(RETENTION OR RESUMPTION OF LAND REQUIRED FOR PUBLIC PURPOSES.)
  Lords Amendment No. 45: In page 46, line 35, leave out "shortly" and insert "in ten years or less".
  Mr. MacDermot: I beg to move, That this House doth agree with the Lords in the said Amendment.
  This Amendment substitutes a maximum period of ten years for the rather vague period denoted by the word "shortly" in the Bill as the period within which a property may be certified by the appropriate Minister to be required for development in order to prohibit enfranchisement or the obtaining of an extended lease from a local authority or similar body.
  During earlier stages of the Bill, a number of Amendments were discussed aimed at having a fixed limit and a period of seven years was suggested. The
  1622
  Amendment gives a period of ten years and I imagine that there will be general agreement that we should have a fixed period. I will explain why a period of ten years has been chosen.
  As the House will be aware, local authorities may be authorised to buy land compulsorily in advance of their requirements, but there is a limit to this. Under Section 97(2) of the Housing Act, 1957, the authorisation of the compulsory purchase of property for housing purposes is limited to a maximum of ten years in advance of the likely date of the property being required for those purposes.
  Again, Section 5(2) of the Town and Country Planning Act limits the Minister's power to approve a development plan which designates land as subject to compulsory purchase to cases where the land is to be acquired within ten years of the plan's approval. It would seem sensible, therefore, when we are trying to remove what would be an absurd position of the leaseholder's enfranchising only to have the property taken back from him compulsorily soon afterwards, that we should adopt some period within which such a possibility might be anticipated under these provisions.
  The Amendment accordingly fixes a maximum period of ten years. It does not follow that the appropriate Minister will always or, indeed, often think it right to grant a certificate when the site will not be needed until the end of the ten years. The Minister will thus always have a discretion whether to grant a certificate or not but the Amendment will improve the position of leaseholders by making it clear that the Clause can only operate within a ten-year time limit.
  Mr. Allason: I am grateful that at least a ten-year period has been accepted by the Government. In Committee I suggested a seven-year period. This has taken a long time to get through the pipeline. It is a necessary safeguard to have a fixed period and it is a safeguard for the tenant. For that reason in particular, I welcome the Amendment.
  Question put and agreed to.
  Lords Amendment No. 46: In page 48, line 33, leave out "so that" and insert
  "in relation to a local authority includes any development to be undertaken, whether or not

  1623
  by that authority, in order to secure the development or re-development of an area defined by a development plan as an area of comprehensive development.
  However—"
  Mr. MacDermot: I beg to move, That this House doth agree with the Lords in the said Amendment.
  The Amendment makes clear that when the Minister gives a certificate to a local authority that land will be needed in ten years or less for a comprehensive development scheme, the scheme does not have to be one which is actually to be carried out exclusively by the local authority. It may be a scheme in which the local authority sells or leases sites to developers to carry out redevelopment. That factor would not alter the correctness of making this provision apply. It is irrelevant who is to carry out the actual development.
  Mr. Graham Page: Why restrict it to local authorities? Under Clause 29 there are many bodies who can take advantage of that Clause and have the Minister's certificate to prevent enfranchisement by their tenants if they can show now, as the Amendment we have just passed provides, that they intend development in 10 years or less. It may be that not only local authorities, but other bodies mentioned in subsection (5) would wish to carry out development by other media than doing it themselves directly. For example, the second group under subsection (5), the Commission for the New Towns. I would think that it is possible for the Commission for the New Town to enter into arrangements with a developer for development of some of its land. Certainly so far as the university bodies are concerned, time and time again they arrange their development not by themselves but by some developer and carry out development in that way. I could go on through the list, the regional hospital boards and so on.
  It seems a pity that this Amendment is restricted to the local authorities. It seems a pity not only that it does not only positively extend to the other bodies mentioned in subsection (5) of Clause 29 but, by introducing this particular Clause relating to local authorities, it precludes this happening by those other bodies. Had this not been introduced the Bill might have been construed as including development arranged by these
  1624
  bodies as well as carried out by themselves. However, with this provision particularly referring to local authorities, I fear that the rest of the Clause may now be construed as excluding the other bodies from carrying out development by assistance from other companies or bodies or persons.
  Question put and agreed to.

  Clause 39.—(MODIFICATION OF RIGHT TO POSSESSION UNDER LANDLORD AND TENANT ACT 1954.)
  Lords Amendment No. 47: In page 63, line 21, leave out "that ground is established" and insert "the property is so required".
  Mr. MacDermot: I beg to move, That this House doth agree with the Lords in the said Amendment.
  This Amendment is consequential on the one that we discussed a moment ago replacing the word "shortly" by "in ten years or less".
  Now that the certificate is merely going to say that the property will be needed in 10 years or less, subsection (2) of Clause 39 goes too far in making it conclusive evidence that the property is needed for redevelopment so soon that the court ought to make an order for possession. The effect of this Amendment is to make the certificate conclusive only of what it actually says, leaving the body to prove to the court that it is actually ready to start operations.
  Question put and agreed to.

  Clause 41.—(AMENDMENTS OF PLACES OF WORSHIP (ENFRANCHISEMENT) ACT, 1920.)
  Lords Amendment No. 48: In page 64, line 45, at end insert—
  "(2) In section 1(1) of the Places of Worship (Enfranchisement) Act 1920 after paragraph (a) of the proviso there shall be inserted as a new paragraph (aa) the following paragraph:—
  '(aa) where the person entitled to the freehold or an intermediate reversion requires that underlying minerals be excepted, the trustees shall not be entitled to acquire his interest in the minerals if proper provision is made for the support of the premises as they have been enjoyed during the lease and in accordance with the terms of the lease and of the trust; and'".
  Mr. Skeffington: I beg to move, That this House doth agree with the Lords in the said Amendment.
  Mr. Speaker: I understand that with this Amendment we are taking Amendments Nos. 49 to 52 and 63 to 66.
  Mr. Skeffington: That is so, Mr. Speaker.
  The purpose of this series of Amendments is to provide for Clause 2(6) of the Bill in relation to minerals to be substituted, in relation to the Places of Worship (Enfranchisement) Act 1920, in place of the Railways Clauses Consolidation Act 1845.
  When we were in Committee a good deal of amusement was occasioned when I was asked among other things to explain when a place of worship was a railway station. In the 1920 Act the only way thought appropriate of dealing with minerals underneath at that time was to apply the same sort of provisions as were to be found in railway legislation whereby the railways had the rights to the land on the top but not to the minerals underneath. Those were the provisions then incorporated, but we thought it more convenient to use Clause 2 as amended earlier this evening. It makes it absolutely clear that minerals are not included unless specifically within the terms of the lease. The four Amendments to the Schedules are a complete reflection, as it were, of the Amendments to Clause 41.
  Mr. Graham Page: We have not had much entertainment, hilarity or joy out of the Bill through all its stages. We have plodded on. It has been an extremely difficult and dull Bill to deal with from that point of view and I am very sad that the one Clause out of which we got a bit of fun is to be removed from the Bill. It was a gem of legislation saying:
  "For purposes of sections 77 to 85 of the … Act 1845 the use of the premises as a place of worship or minister's house, whether in conjunction with other purposes or not, shall be deemed to be the railway and the trustees shall be deemed to be the railway company."
  That was a choice piece of legislation and brought a gleam of light and joy to this wholly miserable Bill. Now we are to be deprived even of that. This little bit of humour is to be removed from the Bill.
  Question put and agreed to.
  Subsequent Lords Amendments agreed to.

  Schedule 1.—(ENFRANCHISEMENT OR EXTENSION BY SUB-TENANTS.)
  Lords Amendment No. 53: In page 73, line 47, leave out from "then" to end of line 4 on page 74 and insert:
  "in relation to the Crown interest and the person to whom it belongs this Schedule shall have effect as it has effect in relation to other landlords and their interests, but with the appropriate authority having power to act as reversioner or otherwise for purposes of this Schedule on behalf of that person:
  Provided that paragraph 4(1)(a) above shall not apply to the execution of a conveyance or lease on behalf of the person to whom a Crown interest belongs."
  Mr. Skeffington: I beg to move, That this House doth agree with the Lords in the said Amendment.
  The Amendment covers a technical defect in paragraph 14 of the First Schedule which was added on Report. This makes provision for the application of the Schedule where there is a chain of leases and one link of the chain is the Crown. Although the appropriate Crown authority under Clause 34(2) can act as the reversioner, it ought not in all cases to execute the actual conveyance or substituted lease. For example, in the case of land vested in the Duchy of Lancaster, although the appropriate authority is the Chancellor of the Duchy, execution should continue to be by the Queen under the seal of the Duchy or County Palatine. This is a form of transfer and it is appropriate that it should be provided for in this Statute.
  Question put and agreed to.

  Schedule 2.—(PROVISIONS SUPPLEMENTARY TO SECTIONS 17 AND 18 OF THIS ACT.)
  Lords Amendment agreed to.
  Lords Amendment No. 55: In page 77, line 2, leave out "by reason" and insert "under or in respect".
  Mr. MacDermot: I beg to move, That this House doth agree with the Lords in the said Amendment.
  This is a drafting Amendment to meet a point raised by the Law Society.
  Question put and agreed to.
  Lords Amendment No. 56: In page 77, line 4, leave out from "sale" to "shall" in line 6 and insert:
  "and compensation is paid in respect of it in accordance with section 17 or 18 of this Act (whether possession is obtained under that section or without any application for possession), the sum received".
  Mr. MacDermot: I beg to move, That this House doth agree with the Lords in the said Amendment.
  Mr. Speaker: I understand that with this we are to discuss Lords Amendments No. 57 and No. 58.
  Mr. MacDermot: These, again, are little more than drafting Amendments to meet points raised by the Law Society.
  Mr. Graham Page: On several occasions the hon. and learned Gentleman has said that Amendments have been inserted to satisfy points raised by the Law Society. As a member of that Society, I thank him for giving attention to the representations made by that source. I am glad that they have been useful and constructively useful in the framing of the Bill.
  Question put and agreed to.
  Subsequent Lords Amendments agreed to.

  Schedule 3.—(VALIDITY OF TENANT'S NOTICES, EFFECT ON LANDLORD AND TENANT ACT 1954 ETC. AND PROCEDURE GENERALLY.)
  Lords Amendment No. 59: In page 81, line 22, leave out "the boundaries of".
  10.15 p.m.
  Mr. Skeffington: I beg to move, That this House doth agree with the Lords in the said Amendment.
  The purpose of this Amendment is again to meet a point of practice raised by the Law Society. It is that the requirement of the leaseholder to identify, as the Bill now stands, the "boundaries" of the property covered by his claim, of enfranchisement for or an extension. It would seem that he might be expected to produce either a map or a very detailed description. Normally when the leaseholder is claiming in such a case, he very often will not have a map or detailed description.
  This is not thought to be necessary now. It is sometimes required, but very
  1628
  often is not, and it was thought that the application here was a little too severe. If the Amendment is agreed to, it does not absolve the leaseholder from making quite clear just what his property is.
  For example if he is not making a claim including a garage which may be under some other arrangement sub-let to someone else, then he cannot include it in his claim and is obliged to let the landlord know that his claim does not extend to the garage, in order that the landlord, under the previous provisions of the Bill, can require the leaseholder to include it under the appropriate Clause.
  It is therefore felt that the arrangement can be quite satisfactorily left, rather than put what might be a very heavy burden upon the leaseholder, and one that is not considered necessary. Again we are grateful to the Law Society for the suggestion.
  Question put and agreed to.
  Subsequent Lords Amendment agreed to.
  Lords Amendment No. 61: In page 81 line 30, leave out "seven" and insert "ten".
  Mr. Skeffington: I beg to move, That this House doth agree with the Lords in the said Amendment.
  This is really consequential. In the Committee of this House the residential qualification for the benefits of the Bill as set out in Clause 1 (1,b) was altered from five out of the last seven years to five out of the last ten.
  The Amendment requires the tenant, in his formal claim, to give particulars of the periods he has and has not occupied the house for the past ten years instead of the last seven.
  Question put and agreed to.
  Lords Amendment No 62: In page 81, line 43, at end insert:
  "(3) The notice shall not be invalidated by any inaccuracy in the particulars required by this paragraph or any misdescription of the property to which the claim extends; and where the claim extends to property not properly included in the house and premises, or does not extend to property that ought to be so included, the notice may with the leave of the court, and on such terms as the court may see fit to impose, be amended so as to exclude or include that property."
  Read a second time.
  Mr. Graham Page: I beg to move, as an Amendment to the Lords Amendment, in line 8, after 'may', insert
  'in default of agreement between the landlord and the tenant'.
  The Lords Amendment to which I seek to make this further Amendment is an Amendment to Part II of Schedule 3 which deals with the procedure on the tenant's notice. That is when the tenant gives a notice under Part I of his desire to have the freehold, or an extended lease. Here is set out the procedure which follows, the form of notice to be given, what should be in the notice and so on.
  We have been dealing in the group of Amendments with a number of detailed points which have to appear in the notice. It is very probable than on many occasions there will be errors in that notice. The Lords Amendment states what should be done if there are inaccuracies in that notice. They shall not be invalidated, but can be put right with the leave of the courts. The Amendment does not say that it can be put right by agreement of the parties. That may be thought to be implied, but the expression in this Amendment is:
  "… where the claim extends to property not properly included in the house and premises, or does not extend to property that ought to be so included, the notice may with the leave of the court … be amended …"
  We seek to insert the phrase:
  "in default of agreement between the landlord and the tenant".
  It is reasonable that the parties should be allowed to agree and the Amendment does not allow them to do so, and I feel that it means that they would have to go to the court to have the notice amended.
  Mr. Skeffington: I am sorry that at this stage I should have to disagree with the proposal of the hon. Member for Crosby (Mr. Graham Page). His Amendments would make it necessary for any inaccuracy or misdescription in the leaseholder's claim to be brought before the court, which would put a great deal of unnecessary work on the court. As the paragraph now stands, there are cases in which resort to the county court would be required—
  Mr. Page: The hon. Gentleman seems to be dealing with an Amendment which has not been selected, the first one. We are discussing only the second.
  Mr. Skeffington: I am obliged to the hon. Gentleman. My note deals with both his Amendments and I was discussing the first instead of the second, which is on a narrower point, but even this makes a provision which is unnecessary and too strict. When I deal with the Lords Amendment No. 62 I will point out certain advantages to that proposal, but the hon. Gentleman's goes too far. I therefore advise the House not to accept it.
  Amendment negatived.
  Lords Amendment No. 62: In page 81, line 43, at end insert:
  "(3) The notice shall not be invalidated by any accuracy in the particulars required by this paragraph or any misdescription of the property to which the claim extends; and where the claim extends to property not properly included in the house and premises, or does not extend to property that ought to be so included, the notice may with the leave of the court, and on such terms as the court may see fit to impose, be amended so as to exclude or include that property."
  Mr. Skeffington: I beg to move, That this House doth agree with the Lords in the said Amendment.
  The Amendment would ensure that a leaseholder's formal claim of enfranchisement or for a 50-year extension was not invalidated by trifling errors. To have his claim so invalidated might be calamitous for him if the error were not detected until after the time for making the claim had passed. This might happen. as the Bill is now drafted, to a leaseholder who had a notice under the Landlord and Tenant Act of 1954 from his landlord terminating the long tenancy, and under paragraph 2(1) of Schedule 3 he would then have only two months in which to counter the landlord's notice with a claim for the freehold or extension.
  The Amendment also deals with the case where a leaseholder has made a substantial error. He might have forgotten to leave out of the claim a garage which is sublet to and occupied by a neighbour, or to include the hot-water cupboard which projects under the stairs of his neighbour's house, a situation which could arise when an old house is divided vertically. Even such substantial errors may be corrected by leave of the county court and on such terms as the court imposes.
  The point of giving the court power to impose terms is that the landlord has the right under Clause 2(4) and (5) to

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  demand that the leaseholder shall enfranchise the garage too or shall not enfranchise the cupboard projecting into the neighbouring house, but this right must be exercised within two months of the leaseholder's claim.
  If the leaseholder is to be allowed to correct his claim by omitting the garage, instead of having his whole claim invalidated, the court will, no doubt, insist on thhe leaseholder's accepting any demand by the landlord that he should enfranchise the garage as a valid demand to be disputed only on the physical merits and not contested on the ground that the landlord was out of time in seeking to include or exclude that part of the property.
  Mr. Graham Page: I entirely agree with the Joint Parliamentary Secretary that inaccuracies in the notice should not invalidate the whole transaction. That is only common sense and the right way to deal with matters between the parties.
  If the tenant has left out the garage or the hot water cupboard but both parties agree that it was by mistake and that it should be included, and they are both happy that the notice should be amended, must they go to the court to get it amended? According to the Amendment, it seems they must. According to the hon. Gentleman's explanation, it seemed to me that the parties cannot do anything without the leave of the court.
  May I have an assurance that elsewhere in the Bill or in the Schedule there is provision for the parties to agree to alter a notice, or perhaps, to agree on terms if one of them may have been put to costs by the error of the other? Let there be terms between them for payment of costs as a result of that error, but, surely, they can do it without going to the court. It could be provided that they go to the court for a consent order, but cannot they do as I suggest without applying to the court?
  Mr. Skeffington: One is here trying to lessen the burden upon an enfranchiser, but it would be wrong to lessen it in such a way that it put the other party, in this case the landlord, into difficulty, which might mean that he lost a substantial part of his right.
  It would seem that in these circumstances, where anything significant occurred, the parties could easily go to the county court and get a consent order.
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  There is no great difficulty. On the other hand, when one is thinking of the rights which may arise out of the transaction, in relation not only to the two parties but to others who may become possessed of the title, it seems right that for the avoidance of doubt the matter should be settled by the court so that fair play can be achieved by both parties.
  10.30 p.m.
  Mr. S. C. Silkin: It seems that where the original landlord and lessee are at one no difficulty will arise since they can act independently of the Bill, but difficulty might arise in a case where the lessee has sold his interest with the benefit of a notice which he has already served but which turns out to be inaccurate. In those circumstances the landlord might seek to take advantage of the inaccuracy and the new lessee would not have his own right to serve a notice for another five years. For this reason the provision to enable the court to make an amendment is a valuable one.
  Question put and agreed to.
  Subsequent Lords Amendments agreed to.

  Schedule 7.—(REPEALS.)
  Lords Amendment No. 67: In Page 97, line 23, column 3, at end insert:
  "In Schedule 3, paragraph 1(d).
  In Schedule 5, in paragraph 7(3), the words from "under the Rent Acts" to "this Act"."
  Mr. MacDermot: I beg to move, That this House doth agree with the Lords in the said Amendment.
  This Amendment proposes two minor additions to the repeal provisions of the Bill. These are no longer needed in view of the provisions of the Measure. They are concerned with technical points, which I will explain in detail if hon. Members so desire.
  Question put and agreed to.
  Committee appointed to draw up reasons to be assigned to the Lords for disagreeing to certain of their Amendments to the Bill: Mr. Allason, Mr. MacDermot, Mr. Graham Page, Mr. Skeffington, and Mrs. White; Three to be the quorum.—(Mr. MacDermot.)
  To withdraw immediately.

STANDING ORDERS (WAYS AND MEANS)
Ordered,
That the amendments to the Standing Orders relating to Ways and Means set out in the following Schedule be made.

STANDING ORDERS (WAYS AND MEANS)

  SCHEDULE
  Standing Order No. 2 (Exempted business)
  Line 10, leave out 'originating in Committee of Ways and Means' and insert 'brought in upon a Ways and Means resolution'.
  Line 14, leave out sub-paragraph (b).
  Standing Order No. 17 (Appointment of Supply and Ways and Means)
  Line 7, leave out paragraph (2) and insert—
  '(2) A Ways and Means motion may be made in the House without notice on any day, so soon as an address has been agreed to in answer to Her Majesty's Speech'.
  Standing Order No. 53 (Amendments on report).
  Line 4, at end add 'unless it has been authorised by a resolution of the House'.
  Standing Order No. 83 (Certain proceedings relating to public money).
  Line 1, leave out paragraph (1).
  Standing Order No. 84 (Procedure upon bills whose main object is to create a charge upon the public revenue).
  Leave out line 2 and insert 'to be brought in upon a Ways and Means resolution'.
  Standing Order No. 90 (Ways and Means motion and resolution).
  Leave out Standing Order and insert new Standing Order (Ways and Means motions) as follows:
  '(1) A Minister of the Crown may without notice make a motion for giving provisional statutory effect to any proposals in pursuance of section 42 (Collection of taxes before passing of Ways and Means resolutions) of the Finance Act 1967; and the question on such a motion shall be put forthwith.
  (2) When the question has been decided on the first of several motions upon which a bill is to be brought in for imposing, renewing, varying or repealing any charge upon the people, the question on each such further motion shall be put forthwith'.—[Mr. Gourlay.]

LEASEHOLD REFORM BILL
Reasons for disagreeing to certain of the Lords Amendments reported and agreed to; To be communicated to the Lords.

ADJOURNMENT
Resolved,
That this House do now adjourn.—[Mr.Gourlay.]
Adjourned accordingly at twenty-seven minutes to Eleven o'clock.