RENT BILL [Lords]

HC Deb 08 July 1974 vol 876 cc1025-106

Order for Second Reading read.

7.8 p.m.

The Minister for Housing and Construction (Mr. Reginald Freeson)

I beg to move, That the Bill be now read a Second time.

The Bill's main purpose is to give security of tenure to the majority of those who are living in privately rented furnished accommodation.

Lack of security in this sector of housing has been increasingly a major cause of homelessness in our housing stress areas. For this reason, as long as five years ago the Labour Party concluded that furnished tenants should be given greater security in their homes. We have continued to press this view—joined by others active in inner city housing problems—and pledged ourselves to act in our 1974 election manifesto. Hence this Bill. It will give security to approximately five-sixths of the 764,000 furnished tenants throughout the country. In London, which has the largest proportion of such lettings, three-quarters of 279,000 tenants will be covered.

Our objective is simply stated. I am afraid that the Bill itself is far from simple. Rent legislation is a complicated and difficult field in which to work, and the urgency of the problems with which we are now dealing has ruled out a self-contained measure that can be understood in its own right, in favour of one that operates by reference to existing legislation—the Rent Act 1968 and the Rent (Scotland) Act 1971.

Those Acts consolidated the existing body of rent legislation, notably the Rent Act 1965. They provided that tenancies where the rent includes payment for the use of furniture—loosely known as "Part VI contracts"—should not be protected tenancies but subject only to the limited protection granted by the rent tribunal. Clause 1 of the Bill removes the provision that excludes furnished tenancies from full protection. It thereby extends to furnished tenants the indefinite security of tenure and the right to have a fair rent registered which have been enjoyed by unfurnished tenants.

The Bill exempts three categories of tenancy from full Rent Act protection. The first of these will be lettings by resident landlords. I know that this decision has been criticised, but I hope that once I have explained the reasoning that lies behind the Government's decision hon. Members will agree with me that it is the fairest and most sensible course we could have chosen.

My own initial preference—I frankly admit—was for retaining the distinction between furnished and unfurnished accommodation and dealing with the question of eligibility for security in the furnished sector by reference to size of household, numbers of persons or some similar criterion. But it soon became clear that any distinction on this sort of basis would be unenforceable and unclear. Families are not static units, and it would be intolerable to have a situation where people stood to lose their security because a member of the household died or moved away.

Moreover, a recent Appeal Court decision—Woodward v. Docherty—has cast considerable doubt on the validity of the distinction between furnished and unfurnished lettings. This distinction has always depended on case law to interpret it and has always produced a hazy dividing line.

A further argument for moving away from the old distinction between furnished and unfurnished lettings was that with the coming more closely together of the two "codes" which is inherent in the basic policies underlying this Bill it would be virtually impossible to maintain a distinction between them.

It was for these reasons that I concluded that we should look for a new basis for deciding who should be eligible for security of tenure. The distinction between tenants of resident and non-resident landlords was the obvious choice. It has clear advantages in its own right. If an owner-occupier has to share his home with a tenant, he will quite reasonably be very careful about his choice—particularly if the tenant will have full security. If resident landlords were not to be exempted under this Bill the under-occupation already prevalent in owner-occu pied dwellings and dwellings let on protected tenancies could be aggravated.

Moreover, the distinction is clear. Rent legislation, as I have already said, is a complicated business and it seems to me vital that we should take every chance to simplify it and thus make it as easy as possible for people to know exactly where they stand under the law. With this end in view it seems much more desirable that a tenant's right to security should depend on whether or not his landlord lives on the premises rather than on whether or not furniture is provided. This distinction, it appears, is so imprecise that nothing less than a High Court judgment is needed to clarify what it means in practice. The exemption of lettings by resident landlords has the great advantage of being simple and easy to understand. As I have indicated, the Bill, based upon this formula, will cover the vast majority of tenants in the furnished sector.

Although, consequently, Schedule 2 provides that, in addition to existing furnished lettings, all new lettings granted by a resident landlord shall be treated as Part VI contracts and therefore subject to rent tribunal jurisdiction, we do not intend to deprive any existing unfurnished tenants of resident landlords of the protection they already have.

I should like at this point to take the opportunity of reassuring those who are concerned about the position of the owner-occupier who lets his home while he is temporarily absent. The right of such people to recover possession of their homes when they need them for their own use has always been recognised, and the Bill does not deprive them of that right. Under Case 10 of Schedule 3 of the Rent Act there is an absolute ground for possession of unfurnished accommodation where the owner-occupier has given notice at or before the time the tenancy was granted that possession may be recovered under this case. In future this case will apply to furnished lettings by absent owner-occupiers.

The Bill also preserves the rights of absent owner-occupiers who have already let their homes furnished to recover possession. If the owner-occupier has let his home on a periodic furnished tenancy and he serves a Section 79 notice—the appropriate notice under Part VI of the Rent Act—at the time of the letting, that notice will be valid for the purposes of regaining possession under Case 10, and he need take no action as a result of the Bill's enactment.

If a Section 79 notice has not been served, the owner-occupier can still guarantee recovery of his home provided he serves the notice appropriate to Case 10 within six months of the Bill's coming into force. These provisions can be found in Schedule 1 to the Bill.

The second category of exemptions concerns holiday lettings. This is an obvious exemption. It would not be right to give security of tenure in a house or flat which is rented for holiday purposes.

The third exempted category concerns lettings to students. The Government realise the need to ensure an adequate supply of lettings to students. We have been considering establishing a system for registering private lettings approved by specific educational institutions for occupation by students. Such lettings would then be excluded from full Rent Act protection. The register cannot however be set up quickly. The framework of such a system will need to be the subject of consultation with representatives of educational institutions and institutions providing courses of vocational training. It will also have to be discussed with the local authority associations. It would have been impossible to complete these consultations in time to make provision in this Bill.

We intend to set the discussions up after the passing of the Bill with a view to bringing early legislation before Parliament enabling a registration system to be set up. All we were able to do in this Bill was to exclude from protection tenancies granted to students by educational institutions specified in regulations made by the Secretary of State. The reasoning behind this exclusion is that it is necessary to maintain accommodation specifically provided for the use of successive generations of students.

However, an amendment carried in another place widened the scope of this exemption quite drastically, so as to exclude from full protection any tenancy granted to almost anyone engaged in a course of study or vocational training. The exemption would apply whether the tenancy was granted by an institution or by a private landlord. This amendment seeks to achieve the same end as that to which, as I have said, the Government are working; that is, the maintenance of an adequate supply of accommodation for students. But the form of the amendment is, I am afraid, hopelessly unacceptable.

The exclusion now relates not to the accommodation but solely to the circumstances of the tenant. Apart from the unfortunate implications which this carries of discrimination against students as a class, it would give rise to formidable practical difficulties. What, for example, would happen when someone who is already a tenant decides—perhaps with a view to changing his career—to become a student for a limited period? Presumably he would lose the protection he enjoys. Or again, what happens when a student, on completing his course, takes a job in the same area where he has been studying? If he does not change his residence, at what point in time, if at all, does he become a protected tenant?

In our view, the amended provision would be totally unworkable and might well prove to have a far-reaching effect on rent legislation as a whole. We shall therefore be asking the House to restore this part of the Bill to its original form—though with the undertaking to produce further legislation, when sensible proposals are ready along the lines I have indicated.

I turn briefly to some detailed points in the Bill. These include, for example, various amendments to the grounds for possession of a dwelling subject to full protection. One amendment, inserted in another place at the instance of the Opposition, would require a court to grant possession of a dwelling which the landlord requires for his retirement. The Government agree with the aims of this amendment, but are not happy with its present form. We therefore intend to bring forward our own amendment during the Bill's passage through this House, which we hope will achieve the same end in a rather more satisfactory way.

Schedule 1 also makes adjustments to the formula for fixing fair rents to take account of the provision of furniture under the tenancy. In Schedule 3 is an important provision to protect those furnished tenants whose landlords have served notices to quit before the Bill comes into force but against whom a court order for possession has not yet been executed. Tenants in this position will have the right, under paragraph 2 of Schedule 3, to go back to the court which will be able to rescind the order if it would not originally have made it had the new Bill been already in force.

The Bill makes some important amendments to Part VI of the Rent Act, which will now include the important category of lettings by resident landlords. The maximum period for which a rent tribunal can grant security by suspending a notice to quit is extended by Clauses 7 and 9 from six to 12 months. The suspension can, of course, be renewed any number of times for periods up to 12 months. Clause 5 raises for England and Wales rateable value limits for Part VI contracts to bring them into line with those for protected tenancies. The limits for both full protection and Part VI will now be £1,500 in Greater London and £750 elsewhere.

The Bill we are bringing before the House today constitutes one of the main components in our overall housing strategy. In the last few years we have watched the supply of private rented accommodation shrink steadily. There seems to be general agreement on the part of most housing experts that this trend is irreversible. Consequently, it will not be long before private lettings cease to represent a significant feature of the housing market.

The Government's view is that housing is essentially a social service and that—apart from the owner-occupier who lets off part of his house—the future lies with the social landlords, that is, local authorities and housing associations, Since coming into office the Government have therefore gone all out to step up the activities of both. This is the only way to hold the rental market and increase it. We have introduced measures to boost local authority building programmes, to encourage the social ownership of rented property and to stimulate the expansion of the voluntary housing movement. Despite the housing situation we inherited from our predecessors, a good deal has already been achieved and I have every reason to hope that we will begin to see even better progress in the coming months.

The situation will not be transformed overnight. For some time to come there will be many people whose rented homes will be privately owned. The rapid contraction of unfurnished lettings in recent years means that those looking for a home in the private market have been compelled—usually very much against their will—to go into furnished lettings. Having no security of tenure, they find themselves—particularly those families in the stress areas of our large cities—forced to pay high rents for inferior accommodation and they are never free from the awful fear of eviction and homelessness.

I need hardly say what a misery this can be for a young couple, or for a family with young children, or for a pensioner living on a fixed income. Such people desperately need the help that this Bill is designed to give them. They will now have indefinite security of tenure in their homes by statute, and they will be entitled to go to the rent officer for the registration of a fair rent, with a right of appeal to the rent assessment committee if they consider the rent officer's assessment too high.

I know that there are those who say that the Bill will bring about an immediate reduction in the number of private lettings available and thus only lead to a worsening of the country's housing situation. Before this debate is over at least one hon. Member will quote the Francis Committee, which recommended against the extension of security of tenure to furnished tenants on the ground that it would dry up the supply of rented accommodation altogether. My view has always been that this was the most weakly argued section of that committee's report. The evidence on which it was based was insubstantial and did not convince me that the extension of security would cause the private rented sector to shrink any faster than it has already been doing anyway. I certainly would not accept it as a valid argument for withholding from those who have to live in furnished lettings the full security they so desperately need. Any housing manager of any major city will say that the biggest single cause of homelessness with which he has to deal is insecurity in the furnished dwellings area of the housing market.

But let me pursue the point about the reduction in the market. The average loss of rented dwellings has been running at the rate of 125,000 a year during the past 10 years. Those who argue that it is regulation and control of the market which dry up rented accommodation should be reminded that it was the period of greatest decontrol under the previous Conservative Government which saw the most drastic loss of rented housing in recent years. I refer to the post-1957 Rent Act period.

Mr. W. R. Rees-Davies (Thanet, West)

Speaking on 23rd January, the hon. Gentleman said: Between 1966 and 1971 rented accommodation fell by just under 68,000 tenancies. In the unfurnished sector the fall was 122.000-plus and in the furnished sector there was a growth of 54,500 tenancies".—[OFFICIAL REPORT, 23rd January 1973; Vol. 849, c. 334.] How does the hon. Gentleman reconcile that with the statement which he has just made?

Mr. Freeson

If the hon. and learned Gentleman will listen carefully to the figures I am about to give, he will see the picture fully. I have explained that there has been an average loss of 125,000 rented dwellings per year from the market over the last 10 years. The most drastic loss occurred during the period following the Rent Act 1957, which was the period of greatest decontrol in this sector of the housing market since the First World War. Between 1958 and 1964, 1½ million dwellings—an average of over 200,000 a year—left the rented market.

Sir Brandon Rhys Williams (Kensington)

Is the hon. Gentleman saying that decontrol of rent was the cause of these properties leaving the market, or was there some question of change in security of tenure?

Mr. Freeson

It was decontrol. I am not sure what the hon. Gentleman is putting to me, but he will recall the Rent Act 1957 which instituted what came to be known as creeping decontrol of security. It was very rapid creeping decontrol. The biggest single problem in the wake of that Act was the question not of rents but of insecurity. No longer did tenants have the security which they previously had, nor did the Act give them any substitute security. There may have been a case for altering the system. We argued in those days that there was no case for removing all kinds of security, which is what happened under the Act.

The significant point I am making is that the most drastic loss of rented accommodation in the past 40 years or more occurred when there was decontrol. I am not arguing what were the causes. I am seeking to make the valid point that the argument of those who say that control, regulation and security caused the loss is belied by the facts. There is a steady loss every year, and the biggest loss occurred when there was the greatest loss of security in the period to which I have referred.

I ought perhaps to emphasise in conclusion the extreme urgency of the situation with which we are dealing. All over the country there are tenants on whom notices to quit have been served. They are in real danger of losing their homes if we do not act quickly. It may well be, now we have come so far with this Bill, that some landlords are trying to get rid of their tenants before it becomes law. I can only hope that those tenants who are faced with eviction are making proper use of their legal rights to remain in their homes as long as they can. They must apply immediately to the rent tribunal for temporary security. They must realise that they cannot be evicted without a county court order. I ask local authorities and those manning citizens' advice bureaux, housing aid centres and law centres, and Members of Parliament, whatever their party, to do everything they can to ensure that tenants know that they have these rights and use them whenever necessary. I ask the House to bear in mind the misery and uncertainty that people faced with eviction must at this very moment be feeling, the hope which they place in the Bill and the need to get it on the statute book with all possible speed.

7.30 p.m.

Mrs. Margaret Thatcher (Finchley)

After having heard a speech made by the Minister for Housing and Construction I am always tempted to abandon my own speech and start a debating battle with him on some of his contentions. The hon. Gentleman tried to rebut the evidence in the Francis Report for the simple reason that it is extremely powerful evidence and is accepted by most people.

The hon. Gentleman's analysis of what happened after 1957 is totally wrong. I remember it vividly. I was a rent-controlled protected tenant and had for years enjoyed the privilege of paying low rent with total protection. When the 1957 Act took effect my husband and I decided—thank goodness—to go in for owner-occupation. The reason why a substantial number of properties went out of the privately rented sector at that time was that since 1915 the landlords had had a raw deal with controlled rents. The moment those properties came out of control for the first time—and some out of security of tenure—the landlords could sell them. Naturally, landlords who had received a very reduced rent for a great many years took advantage of the decontrol to turn their property to good account. That is why the hon. Gentleman's analysis is totally wrong.

The hon. Gentleman well knows why there has been a vast reduction in the privately rented sector. If the Opposition try to restore the privately rented sector, as did my hon. Friend the Member for Kensington (Sir B. Rhys Williams) recently by an amendment, every time we do so the Labour Party, sometimes in government, and sometimes, mercifully, in opposition. say that they will bring back control by security of tenure. That is why houses continually go out of the privately rented sector. We have now reached the stage when the right hon. Gentleman the Secretary of State says that he wants to end the privately rented sector. With all due respect, that has been obvious from his actions for years, but only now has he admitted it.

We are embarking upon the debate under considerable difficulty. There are no printed copies of the Bill and there are no HANSARD reports of what happened in the other place. We are having to make do with these voluminous, un-marshalled HANSARD reports of what happened in the other place, of which there is one copy in the Library. I managed to get one copy of the proceedings of their Lordships' House which is an uncorrected manuscript.

The Minister referred to various schedules. Has he looked at the condition of those schedules as they are presented to the House? Schedule 2 has five manuscript amendments on the first page, the next page has insertions and the following page has some deletions and some insertions. It is impossible to know exactly what is in the Bill with which we are presented. Yet the hon. Gentleman, by his own choice, brings it before the House without making sure that we have HANSARD reports from the other place. When I was in government my own private office always ensured that all the documents required for the debate were in the Vote Office. Last week the 1968 Act was not in the Vote Office and I could obtain it only by filling in a separate form. In my time in government, Departments always automatically ensured that all the necessary documents were in the Vote Office. They are not now, and if the Government cannot administer that, they cannot administer anything.

Until a few weeks ago many of us had the impression that furnished flats did not carry full security of tenure. True, the landlord had to go to a tribunal, and possibly to the court, to secure possession, but if the landlord persisted we thought that he could ultimately regain possession of a flat that was full of furniture. The hon. Gentleman made only a passing reference to case law being important in drawing the line between an unfurnished and a furnished tenancy. He knows, or should know, that even without the Bill a few weeks ago a major change in the law was brought about by a decision of the Court of Appeal—on 24th April 1974—in the case of Woodward v. Docherty. That decision, in effect, gave security of tenure to probably the majority of tenancies which previously counted as furnished tenancies but which by virtue of that decision became unfurnished tenancies. I was amazed that the hon. Gentleman made no reference to that case.

Mr. George Cunningham (Islington, South and Finsbury)

He did.

Mrs. Thatcher

The Minister made no detailed reference to it—I apologise. The Court of Appeal decision was extremely far reaching. It was a case in which a basement flat, fully furnished and let for £10 a week, was held not to be a protected tenancy within the meaning of Section 2 of the Rent Act 1968. Admittedly, it was fully furnished, and I quote from the judgment in the Court of Appeal: The flat was let fully furnished, the judge of first instance finding that ' the flat contained almost everything that Mr. and Mrs. Docherty would require ', though some items were not of the standard they would like and did not work as well as they might have expected. Later, the Court of Appeal said of the judge of first instance: I think the judge attached too much importance to the fact that the flat was fully furnished". I mention the case because it fundamentally changed the law in regard to what was or was not a protected tenancy. If those who had thought they were furnished tenants had gone to the county court or the tribunal and cited that case, many tenancies previously thought of as furnished would have been adjudged unfurnished under the new criterion. The new criterion was the interpretation of what is a substantial proportion of the rent attributable to the use of the furniture. Unless a substantial part of the whole rent is attributable to the use of the furniture, the tenancy is not a furnished tenancy.

In that case the test used for deciding whether a substantial part of the rent was attributable to furniture was an interesting and unusual one. The court decided that the market value of the furniture at the date of the letting should be taken. The furniture having been there for 12 years, the market value was comparatively low. I must confess that if some of my furniture went to a sale room it would not fetch much either. It was decided that the market value of what the furniture would fetch at the time was about £100. Therefore, although the flat was fully furnished, a substantial proportion of the £10 rent was not attributable to that furniture.

The same doctrine applies to attendance. There must be flats which are technically furnished flats but which in reality are not, where certain services are available. The same reasoning applies. Unless a substantial proportion of the rent is attributable to attendance, that attendance will not prevent it from being a protected tenancy.

I come to my own approach, in my constituency, to landlord and tenant cases. I think that the approach of most hon. Members is the same. There is a general sympathy for and desire to help whichever person—either landlord or tenant—appears to have had a raw deal in the circumstances of a particular case. Most of us know that sometimes tenants and at other times landlords have a raw deal. I wish that in some ways the landlord and tenant law were drawn on a basis of equity, but over the years this has not been so. If it had been, I believe that the housing problem would be different from what it is at present.

I have known cases where, in equity, the landlord clearly has been in the right. I had one case involving a spinster of 79 who had two properties with controlled tenancies, and those properties were about to move into a fair rent situation. That has now been stopped by the Minister, but it is a case where the tenants are better off than the landlord and where all repairs are carried out by her. The equity is on the side of the landlord but the law is on the side of the tenants.

There have been other cases involving landlord and tenant, one of which involved a widow who turned her house into two self-contained flats. This sort of conversion is often the only means of providing an income that a widow can obtain. When the widow wanted to sell the whole house she could not do so, although she was nearly 80, because she could not get the tenants out. Again, in that case the tenants were well off.

Another case involved a lady owner-occupier who wanted to let rooms in her house. They were fully furnished rooms; the tenant was provided with no service or food, but shared a kitchen and bathroom. The tenant harassed the landlady. Many hon. Members know that such harassment of a landlord or landlady is not unknown. Although this involved a furnished letting, the owner-occupier had to go to the rent tribunal to get possession. The rent tribunal can suspend for six months, then suspend again for a further six months, and so on. Eventually, the owner moved out of her own house until the tenant could be got out.

In that case the owner-occupier had to pay extensive solicitors' fees, and received no rent because the tenant vanished without paying, and the owner-occupier had to repair the damage to furniture. Again in that instance the equity was very much on the side of the landlord. The Francis Report, on page 111, points to cases in which individual landlords, for example, elderly ladies, are harassed by tenants. I cite these cases as showing that this House, under successive Governments, seems to have made no attempt to be fair to the landlords.

There are other cases in which the equity is all on the side of the tenants. I have known cases in which landlords have harassed tenants with noise, rudeness, ridicule and frightening incidents to get those tenants out of the dwellings. There have been other cases in which the landlord has paid little attention to repairs, or has refused to take measures to fight damp, and so on, and cases where the landlord, for no good reason, has given the tenant notice to quit. I knew of one case in which a tenant refused to pay rent because of the behaviour of the landlord. This behaviour caused the tenant to get into trouble with the tribunal.

In all those cases the equity is on the side of the tenant. We do not seem to have approached landlord and tenant law on any basis other than the expediency of the moment. We should try an approach on the basis of fairness between landlord and tenant. We have done much to help the deserving tenant but comparatively little to help the deserving landlord, or to encourage him to let empty houses or vacant rooms.

The Minister may claim that under Schedule 2 to the Rent Bill there is one improvement for landlords, namely, that new unfurnished tenancies with a resident landlord do not carry security of tenure for the first letting, which may be for an unlimited number of years provided that the number is specified. The two-year limitation was struck out in the other place. Therefore, the first new unfurnished letting on the part of a resident landlord for a fixed number of years is the only one which escapes security of tenure at the end of that term of years. This is an improvement, and on that basis is to be welcomed, but, on the other hand, the Minister has extended the period for suspension of notice to quit from six months to 12 months, and there can be a renewal of the 12-months period. That of itself will not encourage the maximum amount of new accommodation to come on to the market.

I wish to turn to a number of other aspects of the Bill. On the main point in respect of protection, the real danger as we see it is that the supply of new lettings will be severely affected and may even cease. The situation will be similar to that in regard to unfurnished controlled tenancies. In the old days if a person occupied an unfurnished controlled dwelling he was sitting pretty; otherwise he had no chance of obtaining such accommodation. In other words, the situation assisted those who were controlled tenants but acted in a damaging way in respect of all those who sought accommodation and found the supply was reduced.

There are many empty rooms, cottages and flats which could be made available by owner-occupiers, but these people are afraid to take such a step. They feel that they have little chance of obtaining possession when they need it even though reasonable notice is given, and they fear the position which may arise if the present or any future Government give extra security of tenure where it does not now exist. I suspect that during the passage of the Bill we shall have many demands for extra security of tenure affecting resident landlords, or those cases where board is provided. The second reason why landlords are afraid to take this step is that the amount of rent described as "fair or reasonable" is often neither fair nor reasonable, considering the outlay and the risks involved. I know a case where the owner-occupier of a large house borrowed money to have his house converted properly into several flatlets with the aid of an improvement grant, only to discover that the fair rent awarded by the rent officer did not begin to cover the interest on the outstanding loan, let alone cover any prospect of return on capital. In those circumstances if the fair rent were increased the tenant could get the extra rent allowance under legislation passed by the Conservative Government.

Mr. George Cunningham

Does the right hon. Lady agree that the price paid by the owner for his property should have reflected the level of fair rent that he thought he would obtain? Should not the price have been lower than the sum he paid for it?

Mrs. Thatcher

I think the hon. Gentleman has misunderstood me. I was referring to the person's own house. The man in question had lived in it for some time. The argument involved the cost of converting the rooms into proper flatlets. It was a good conversion, and the fair rent was not enough to service the loan. The owner wrote to me and asked what he should do. The answer may well be that before one embarks upon such a scheme one should ask what the fair rent would be, but having found the answer the person concerned may well decide not to do the conversion and therefore the new accommodation would not come on to the market. That is another reason for taking the view that fewer lettings are likely to come on to the market.

The Minister will no doubt claim that a fair rent is a fair rent is a fair rent, or is a reasonable rent, but as far as I can see there are five different bases of valuation affecting hereditaments in the rent and rating Acts. First, in the 1968 Act there are three different bases of valuation. There is the fair rent under Section 46(2) which, in effect, is a market rent minus the scarcity factor. Then there is a different basis of valuation for the Part VI furnished letting, as set out in Section 73(1)(b). There, the tribunals have power to reduce the rent to such sum as is reasonable. The reasonable rent there is a different basis from the fair rent basis of Section 46. Then there is a third basis of valuation under Section 2(2) as it applies to furnished tenancies, when trying to discover the proportion of the rent attributable to the furniture. That is based upon the market value of the furniture at the time of the letting. But the rest of the rent is not based upon the market value of the flat with vacant possession at the time of the letting. So there we have one rent in one section with two separate, different bases of valuation for that single flat.

There are two other bases of valuation. The first is the one which the Minister is proposing to reintroduce under his circular under the Housing Finance Act, where he goes back to reasonable rents under the Housing Act 1957 for council properties, which must reflect a reasonable balance between tenants and rate payers. That is a different "reasonable" from the "reasonable" in this Act.

The fifth basis of valuation is that for rating, which is open market rental value.

It is quite absurd to have five different bases of valuation. But the Minister is introducing extra bases of valuation. He is having the one in his circular. He could take advantage of this Bill to alter all those in the 1968 Act, because the whole Bill is drafted by reference to the 1968 Act and, mercifully, the Long Title that he has given to this Bill would enable almost any amendments to be made to the 1968 Act. That, no doubt, will give the hon. Gentleman food for thought before this Bill completes its Committee stage.

On valuation, the state of the 1968 and other Acts is in a great muddle. What the hon. Gentleman is doing in this Bill will also put the administration of the law into a great muddle. As far as I can see, having looked at it, in the case of a landlord who is never resident, the rent of an unfurnished flat goes through the rent officer and the rent assessment panel system. Therefore, that landlord applies to the rent officer and to a rent assessment panel. The ruling is that the rent assessment panel must give an answer with reasons about the rent which it decides is the proper fair rent. In that way, we have a process for comparison between all the cases which it decides under that branch of the law.

Under the new Part VI cases in this Bill, in the case of a resident landlord, a new unfurnished letting will go not through the rent officer and the rent assessment panel but to the rent tribunal system which I gather gives oral judgments and does not have to give reasons for its judgments unless specifically requested and which does not have to put its answers in writing. Furthermore, there is no system of cross-checking between one rent and another decided by that rent tribunal, and no system of appeal from that rent tribunal.

For unfurnished lettings, therefore, the whole administration goes up two different arms of the law. As far as I can see, not only is the valuation in a muddle; the legal administration will be in a muddle, too.

I want now to say a few words about the position of students. If the Minister takes out the amendment which was put in in another place and does nothing to change the Bill from the original Bill before the beginning of next term, there will be considerable difficulties in the university towns. I know that in a town where there is a university, a polytechnic, a couple of colleges of education and a college which is doing advanced work, there will be a large additional influx of students each year because of the expansion. There was always a crisis of accommodation at the beginning of the year. If, as a result of this Bill, or the Woodward v. Docherty case, security of tenure is given where none exists at the moment, there will be a serious shortage of accommodation this September and very little way of getting over it.

Ultimately, under this Bill there will be a shortage, unless the Government are prepared to cut substantially the number of students, especially in those towns which have several institutions of higher education. I can see for the first time a genuine crisis of accommodation for students as a result of what the Minister said he proposed to do, unless we can persuade him to do something different. Alternatively, the students will not have to go to their chosen colleges. They will not all have decided yet, because they will not know their A-level results. Many will have to choose colleges near their homes. But there are not suitable courses for everyone near home. It is clear that the Minister will have very great difficulty with accommodation for students if he attempts to leave the Bill in its present form.

I noticed what the hon. Gentleman said about the position of those buying homes for their retirement. Thanks to the efforts of my noble Friend, the Baroness Young, the Bill contains an amendment which protects those who buy homes for retirement but do not live in them until retirement. That amendment was put in in Committee at her insistence and at her persistence against the will of the Government. I have looked through what purports to be the relevant HANSARD and I notice the resistance with which the amendment was met originally. I congratulate the Minister on his conversion.

Clearly, we must give protection to those who during their working lives live in tied houses, whether they be Ministers, headmasters or principals of colleges of education, and who know that if they leave it until retirement to purchase a home they will not be able to afford it and, accordingly, attempt to buy long before retirement, not to occupy those houses but with the intention of letting them either as furnished or as unfurnished tenancies—probably furnished—to help pay the mortgages. These are people who want to help themselves and who are used to doing so. We must make it clear in this Bill that they are fully protected, and can get possession when they want to.

I notice that the present amendment is not fully effective for that purpose because it is hinged to the clause dealing with holiday lettings, which is possibly the only one to which it could be attached.

Mr. Rees-Davies

May I draw my right hon. Friend's attention to the fact that present Ministers of the Crown have a number of houses which they let, and that they may find themselves in difficulty after the General Election when they lose office and are unable to get back their houses?

Mrs. Thatcher

I spent some time over the weekend puzzling out whether the tenants of a furnished house would be deemed to be unfurnished tenants by virtue of the Woodward v. Docherty case. I could not make up my mind. I tried to decide it on the basis of a case in High-gate, taking the value of the furniture at so much and the rent at so much. It is possible that some of those may have Woodward v. Docherty protection, but they may not.

That brings me to another point mentioned by the Minister. Owner-occupiers who have let their houses furnished and are away or in other accommodation will now have to give notice within six months if they are to regain possession when they return. I hope that Ministers of the Crown are not so busy within their Departments that they do not observe the legislation passing through this House. Some people who are abroad and have let their homes will not know that they have to give notice within six months if they are to regain possession of their houses. We must pay attention to that point in Committee.

I have been through the Bill, with the 1968 Act alongside it, and found innumerable points which require to be clarified, a large number of which will need amending. Every subsection seems to require something because circumstances will arise which are not properly catered for.

I am not happy that the Minister has adequately provided for holiday lettings. The holiday accommodation would need to have been let in the previous year. There may be cases where people have had a year off because of illness or other circumstances. Those cases are not properly covered by the Bill.

As yet, people cannot be forced to let empty accommodation; they can only be persuaded. If I were asked to advise a resident landlord whether to let, having read the Bill I should advise him that the risks were too great, because he may not be able to regain possession. More legislation may be passed. A landlord may not be certain of getting a fair rent. I always look at legislation in terms of what I would do. If I were asked to give advice to a member of my family or to others I should have to tell them that if they wanted to regain possession and get a good return they ought not to let their accommodation. One's home is too precious to risk the amount of disruption that could occur.

The substance of the Bill has in some measure been pre-empted by the case to which I have frequently referred—Woodward v. Docherty. I hope that it is clear that I do not like the structure of the Bill, or its detail. It is legislation by reference. The Bill is a poor professional job. That is not the fault of the draftsmen. It is due to the inadequate instructions given to the draftsmen. The Bill is difficult to interpret within the framework of existing legislation.

I hope that my hon. Friend the Member for Hornsey (Mr. Rossi) will be selected to serve on the Committee. He is far more expert than I am in landlord and tenant law. I hope that in Committee he will call attention to the many matters which even I foresee will give rise to difficulty.

I fear that the Bill will lead to less, not more, accommodation being available. The Minister thinks that he can cope with the situation by continually pouring more ratepayers' and taxpayers' money—that is what it is—into the public sector. He cannot, because the sums are so enormous that ratepayers and taxpayers will not pay them both for their own and other people's accommodation, unless those other people cannot afford it. However, that is a different matter. [Interruption.] Rebellions that we have never seen before? The reason is that the combination of taxes which people are having to pay is too great for them to bear. The Minister will have to rely on the private sector if enough accommodation is to be found. Therefore, he would be well advised to heed the amendments which we shall put down in Committee if he is to get the Bill through.

8.5 p.m.

Mr. Bruce Douglas-Mann (Mitcham and Morden)

I am tempted to abandon what I intended to say and to start by answering some of the points made by the right hon. Member for Finchley (Mrs. Thatcher) and particularly to correct the errors that she has expounded.

Before coming to such detailed points, I should like to give an immense welcome to the Bill. It has been my major political objective for many years to achieve legislation with this aim. Indeed, at the Labour Party Conference in 1969 I had the privilege of moving the resolution which resulted in the Bill becoming Labour Party policy. Therefore, I am delighted to see it being proposed in this House now, but I am alarmed to hear from the Opposition of a possible filibuster in Committee which may endanger the Bill.

I have lived in North Kensington for 16 years and for nearly four years I represented the constituency in Parliament. A housing survey of that area in 1968 found that 68 per cent. of households were occupying so-called furnished accommodation. I say "so-called" because the right hon. Lady suggested that Woodward v. Docherty changed the law. On the contrary, in 1948 the House of Lords in its decision in Palser v. Grinling and Property Company v. Mischoff held exactly as the Court of Appeal affirmed in Woodward v. Docherty.

Mr. Hugh Rossi (Hornsey)

rose—

Mr. Douglas-Mann

The hon. Gentleman will no doubt speak later and he can then correct me if he wishes. The House of Lords held effectively what the Court of Appeal upheld in Woodward v. Docherty.

In every case that came to me, as a lawyer acting for tenants, I raised the question whether a furnished tenancy or so-called furnished tenancy was a furnished tenancy. I have challenged that point in court in every case and only in about 5 per cent. of cases where the issue was raised did the court hold that the so-called furnished tenancy satisfied the test contained in the Rent Act.

I was glad that the right hon. Lady drew attention to this matter. I sincerely trust that the Bill will not be delayed. I should like to emphasise that, as she said, there are few genuinely furnished tenancies. Anybody who is threatened with eviction should not only go to the rent tribunal but should wait until a county court has declared his tenancy to be a genuinely furnished tenancy, and should argue the point vigorously before the court.

Mrs. Thatcher

Why is the Bill necessary.

Mr. Douglas-Mann

It is necessary because it is essential in every case, before a so-called "furnished" tenant gains security of tenure, for him to get legal aid, and a lawyer, to get evidence from surveyors or valuers and to be utterly determined. On average, it takes a day or a day and a half—and in many cases it takes two or three days—for the county court to conclude, as almost invariably it does, that, notwithstanding that a letting is described as a furnished tenancy, it does not fulfil the necessary requirements which have existed in the law for many years.

Even if the Bill should be delayed, almost every tenant has protection in the law, provided he knows how to go about getting it. Unfortunately, the machinery to enable a tenant to get the legal protection to which he is entitled is so complex and difficult to operate that only a Bill which puts the distinction at the right point, abolishing this wholly artificial and irrelevant distinction whether a tenant has furniture forced upon him which he does not want, will help him. The Francis Committee found that a high proportion of all furnished tenants would have preferred to have unfurnished tenancies. They did not want furniture forced upon them. The distinction whether a tenant has unwanted furniture should cease to be the test of his security. The relevant test should be whether the landlord regards the premises as his home, not simply as an investment.

The right hon. Lady said that from 1915 to 1957 landlords had had a poor deal. That may be so—it depends upon what one means by a poor deal—but surely she does not imagine that somebody who bought property in 1915 waited until 1957 for Conservative justice. The value of the property must have been very low at the time it was acquired, and it is scarcely likely that an individual who bought property in 1914 would still be holding on to it 43 years later.

In practice, people who bought cheap tenanted property received a windfall under the 1957 Conservative Government. I was a protected tenant in 1957, and I found that at the same time as I lost my security the value of property shot up so fast that it was impossible for me to stay in the area where I had lived for many years. I had to move. Many people who were in a less advantageous economic situation than I was were forced not only out of their homes but out of London. They were forced away from their jobs, their families and their friends. The Bill is directed at doing away with that kind of insecurity, and it will achieve that aim.

In welcoming the Bill I have in mind a number of specific cases in what used to be my constituency of North Kensington. I am thinking particularly of some elderly spinsters. I have in mind three nurses who are waiting for the Bill to become law. I shall not name the property in which one elderly person is living, because the landlord is still hovering around like a wolf at the door trying to hound her out of her property and gain possession before the Bill comes into force.

In one instance, a qualified nurse in her late 50s has lived at the house in question for 14 years. She is caring for an unfurnished tenant in her early 80s who lives on the ground floor. The landlord has accepted that he has to rehouse the unfurnished tenant, but he is trying to evict the furnished tenant on whom she depends.

Another case is that of a retired nurse in her early 70s who has lived in her accommodation for 17 years. She has no hope whatsoever of finding any other accommodation in that part of London at a rent that she can begin to afford. This is the only area in which she has friends and contacts, having lived were since the end of the war. She, too, will be evicted unless the Bill goes through in good time to prevent that from happening.

These are exceptional cases in which the landlords have been alerted to the dangers that Woodward v. Docherty illustrated and realised that the Rent Act gave a landlord freedom to evict only if the value of the furnishing was high in relation to the rent. After buying premises, they took care to offer existing tenants a newly furnished room on a different floor so that the ratio of rent to price was such that there would not be adequate protection.

From my experience in local government and as a Member of Parliament I could cite many tragic examples of people having lost their homes because it has been impossible to obtain protection under the law. I constantly come across cases in which it is too late to do anything. The tenancy has been forfeited, notwithstanding the fact that the Rent Act gives only a small minority of landlords freedom to evict.

The right hon. Lady predictably made a lot out of the argument that the number of lettings will decline as a consequence of the Bill becoming law. It would be less than frank not to accept that there is likely to some reduction, but the decline has been continuing at a great rate since 1957, and there will be a very much faster decline if the Bill does not become law. Whether it is a good or a bad thing is perhaps arguable, but the effect of announcing that one is to legislate in this way is to speed up the rate at which the speculative landlord—that is, one who has bought solely for profit—will seek to turn out his tenants. If he does turn out his tenants, he will find that under the Bill he will not readily be able to make the killing that he is expecting.

Francis reported landlords as saying that if security were extended to furnished tenants they would prefer to sell rather than to let. I accept that that may be the view of most individual landlords, but there are about 750,000 furnished lettings, and in practice it would not be possible for all those properties to be sold. As Miss Lyndal Evans pointed out in her minority report, The only parts of the furnished sector which would be readily saleable for owner occupation are purpose-built flats and whole houses let furnished…Accommodation in flats in converted houses accounts for 42 per cent. of all furnished accommodation…Accommodation let as rooms accounts for 46 per cent. of all furnished accommodation. That being so, only a small proportion of accommodation would be available for selling, because it would not be possible to sell the unsatisfactory conversions which form the great majority of the total. They are unsaleable, and even if landlords attempt to turn out their tenants and sell the property they will find that it is not practicable to do so. But even if, regrettably, landlords were to take that course, the rate of decline would probably be very much slower than the decline that will inevitably occur if the Bill does not become law.

Mr. Peter Emery (Honiton)

Does the hon. Gentleman accept that if the Government want to increase the number of rented tenancies coming on to the market the best way to do it is to announce that they have no intention of ever again extending rent control into this area? It is only if that statement is made that anybody will be reassured enough to provide this type of rented property. At the moment, as my right hon. Friend the Member for Finchley (Mrs. Thatcher) said, people are scared of letting property because they do not know what further steps will be taken by the Government. If the Government want to encourage this sector of housing, they must take action contrary to what the hon. Gentleman is suggesting.

Mr. Douglas-Mann

That would be one way of getting accommodation, but at a price. The hon. Gentleman knows what value property has reached in certain areas, and he knows, too, who is benefiting therefrom. The Government deplore it, but it is a fact that the cost of providing any kind of self-contained accommodation is extremely high. Without controls over the level of rents, the amount of accommodation for letting would be small and at a price which nobody employed even in a skilled manual job or an ordinary clerical job would have the slightest chance of being able to afford. There would be an upper-and middle-class London, Birmingham, and so on, and there would be no working-class residents in those cities.

The hon. Member for Honiton (Mr. Emery) can see what is happening in such places as Berlin and Bonn. There is no rent control, and the centres of those cities are occupied by middle-class people and foreigners. Working-class families are housed in vast estates outside the city areas. The social and community life in the centre of the city has been destroyed in the interests of property developers. That is what the hon. Gentleman is advocating. Yes, it would provide accommodation to rent at a price, but at a price which is totally socially unacceptable and which would destroy the existing communities of London.

There are still substantial communities in London, but they will not survive if the action which the hon. Gentleman advocates is followed. The only way to preserve communities is by providing security of tenure and by ensuring alternative sources of supply of rented accommodation. The Bill will achieve this to some extent. We shall now be having the right distinction when it comes to the provision of accommodation. Where an owner-occupier is letting part of his home, he will be able to let in the knowledge that the tenant will not have security of tenure.

The right hon. Lady the Member for Finchley said inadvertently—I think I am correct—that the exemption of the owner-occupier's letting is not confined to a fixed term of letting. The owner-occupier letting part of his home, whether furnished or unfurnished, will be able to recover possession and it will be treated as a Part VI contract.

The Under-Secretary of State for the Environment (Mr. Gerald Kaufman)

indicated assent.

Mr. Douglas-Mann

I am glad to see that my hon. Friend confirms this. It would be unfortunate if there were some misunderstanding about this. I share the hope that owner-occupiers will in future be prepared to make rooms available in their houses for subletting. It may not be a satisfactory way of providing homes, but it is a much more satisfactory way to cater for the minority who want accommodation for relatively short periods than the situation which exists at present, such as in Notting Hill, stocked with houses, managed by Lawrence—

Mrs. Thatcher

I am sorry to interrupt the hon. Gentleman, but in the first print of the Bill the two years period was included. With this manuscript amendment, the two years are not included. Am I therefore right in thinking that the resident owner-occupier can let unfurnished under a Part VI letting for an indefinite period and can always recover possession through the rent tribunal procedure?

Mr. Douglas-Mann

That is my understanding of the Bill. Incidentally, I found that it was much easier to follow this Bill having read it when it was first presented in the House of Lords. I found it helpful, when rereading it after it had emerged from the other place, to find that the amendments appeared in another form of type.

Mr. Kaufman

Perhaps it will be convenient if I intervene in my hon. Friend's speech at this point and make the situation clear to the right hon. Lady who astonishingly was so much in error. I was devastated that the right hon. Lady could actually make an error.

May I make it clear, for the benefit of the House, that under our Bill any periodic tenancies will be exempted from full protection. The first fixed-term contract granted to any particular tenant, and additionally to periodic tenancies, will be exempted from full protection. Of course, a fixed-term contract could be followed by a periodic tenancy. But I should like to make it clear that it is not only an extended fixed-term tenancy which is exempted from protection. Under our Bill any periodic tenancy will be exempted from protection. It is only the second of two fixed-term contracts granted in succession which will qualify for full protection.

Mrs. Thatcher

That is rather closer to what I said than to what the hon. Member for Mitcham and Morden (Mr. Douglas-Mann) said. Could the Under-Secretary point out the words upon which he relies for that interpretation? With five manuscript amendments, one page of printed amendments and a second page of deletions and amendments, it is impossible to get that meaning out of this muddle. The hon. Gentleman is now talking not about an unlimited periodic tenancy but a fixed term followed by something else or not followed by something else.

Several Hon. Members

rose—

Mr. Deputy Speaker (Mr. Oscar Murton)

Order. I have been slightly indulgent on this occasion, but I think the hon. Gentleman should be allowed to continue speaking for some little time before he is interrupted again.

Mr. Douglas-Mann

I thought that was a useful series of interventions, even if they were not strictly within order As I understand it, the second point made by my hon. Friend is to clear up the anomaly of the avoidance of control by the presence of letting on fixed-term tenancies, letting for four weeks or six months at a time. thereby attempting to evade the protection which the rent tribunals can give. That will, no doubt, be cleared up by my hon. Friend.

My alarm is considerable when I hear the right hon. Lady talking about the attitude which the Opposition are likely to adopt to this Bill. The co-operation of the House will be needed to ensure that the Bill becomes law. If it fails, the wolves will be not just at the door; they will have broken through the last barriers. I know only too well how the Rachmans in North Kensington are striving to get rid of the furnished tenants before the Bill becomes law. If the Opposition decide to protect them, the Opposition will have a very heavy burden on their conscience.

They say, with Francis, that the purpose should be to encourage private landlords to let. If private landlords are only willing to let on a basis where they can turn their tenants out when it suits their convenience, the accommodation, if provided, cannot be regarded as a home. If a tenant knows that he can be turned out of the house the moment it suits the landlord's convenience, when somebody richer than the tenant comes along or when the landlord wants to sell the house to make a capital profit, the tenant has no feeling that where he is living is his home. He is living in accommodation that is cluttered with furniture that he does not want and he is living in a situation which he can never enjoy the sense of security which everyone in this House regards as automatic. If that security is not provided because of filibustering on the benches opposite, the Opposition will have a heavy burden on their consciences.

8.28 p.m.

Sir Brandon Rhys Williams (Kensington)

I want to declare an interest in that I let furnished flats in my own house and also let a furnished cottage. I am proud of my relationship with my tenants and I do not think that any of them seriously wishes that relationship to be disturbed by legislation—but perhaps I shall now be getting letters from them after saying that. I also have an interest in the Bill because Kensington has more furnished tenancies than any other constituency. The hon. Member for Mitcham and Morden (Mr. Douglas-Mann), the previous Member for North Kensington, has made this a particular study.

The Bill, if it is to be a useful measure, should be a small part of a much bigger housing programme. The speech of my right hon. Friend the Member for Finch-ley (Mrs. Thatcher) gave me an uneasy feeling that the Bill has been far too hastily put together and that many points will have to be attended to in Committee if it is to be a satisfactory piece of legislation. However, I congratulate the hon. Member for Mitcham and Morden on getting this measure brought forward through the Department. To work so long and hard and then to see the result of one's labours so near must be a proud moment. I understand that.

I also understand the reasons why the hon. Member feels that something has to be done, particularly in Kensington, about people living in wretched and insecure accommodation. When one talks to representatives of Shelter, the Child Poverty Action Group or other bodies concerned with housing and poverty problems, one hears of a stream of cases which seem to be soluble only with security of tenure. But what these cases prove is that the whole housing situation in the country is thoroughly unsatisfactory. The worst cases are often social rather than housing problems. To install a family permanently in unsuitable housing is not to meet their social needs.

Nor should families be given perpetuity of tenure in accommodation which can only be satisfactorily improved by its demolition and their rehousing. The Housing Bill should be able to make a contribution to the problem of hopelessly obsolete and inadequate furnished accommodation in the housing action areas. Perhaps it might have been more prudent if the Government had waited to see the effects of that Bill before rushing forward with this one.

To make an unsatisfactory home a permanent one is not a true solution of the housing problem. There will always be bitterness if the Bill goes through, because landlords will feel that tenants have acquired their accommodation without paying for it. There will be bitterness and inadequate housing whether or not permanent tenure is given to furnished tenants.

Surely the right answer is to make it easy for people to move if they want to do so, or if they have to move for family or employment reasons or because of strong personal preferences. If the housing market is made even less fluid, as it will be by the Bill, the crisis of accommodation to which my right hon. Friend referred will be made worse. The Government should be putting their minds to the fact that the market is not sufficiently fluid.

I was shocked by the Minister's ready acceptance of the idea that the decline in the rented sector was irreversible. It has proved irreversible in an atmosphere of control, but if the Government exerted themselves they could find solutions. I have spent considerable time, perhaps too long, trying to put before the House some recommendations of my own which no doubt could be improved by experts and by study. There is an opening for the Department on these lines, but it has shown that, for doctrinaire reasons, it does not wish to take it. It actually prefers to see the market for rented accommodation drying up except in the municipal sector. That is not a satisfactory recipe in the long run.

The market is not sufficiently fluid and the Bill will make it less so.

Another problem is that those who enter the market are generally least able to stand exposure to market forces. As I have said before, subsidies are available, sometimes generous ones, to people in various categories of housing. Owner-occupiers can probably get subsidies through the tax system people in municipal accommodation may receive very large subsidies, far larger than they need; and people in controlled or regulated accommodation are indirectly subsidised by their landlords. But people in any of these categories who have to leave and go to the market for accommodation cannot meet the rents demanded and then they become a problem which concerns us all.

We should therefore look again at the whole structure of housing subsidies to see whether they are aimed at the real needs. The Housing Finance Act may have been controversial, although I thought it contained many fine and useful things, but if it did not go far enough let the Labour Party come forward with its own ideas for reform of housing subsidies.

I invite hon. Members to look at the different ways in which one can draw subsidies at present. There are option mortgages, rent allowances, rent rebates and housing allowances. There are the special allowances within the supplementary benefit which take account of actual rent. The national insurance system, as I have pointed out in other connections, also has a built-in structure of housing allowances in pensions and virtually all the other national insurance benefits.

This whole system is waiting for a Bonaparte of administrative ability and competence who can reform the entire structure of housing subsidies. I should like to feel that someone on the Government benches was working on these lines and would shortly be coming forward with specific proposals to solve the whole housing problem, looking at it as a cash problem and as a bricks and mortar problem. Instead of that, however, we are seeing measures brought in which echo those of the previous Government, or measures of this kind which are not sufficiently thought out and provide only a partial solution.

A further point is that existing accommodation is not being used to best advantage. In many municipal estates there is accommodation which is not being used to best advantage, though perhaps that is not a general complaint. But in the private sector there is a great deal of accommodation the best possible use of which is not being made, possibly because people are afraid of letting. This will now be made worse because more people will be afraid of letting, who would have let previously, at any rate furnished accommodation. To leave a house must cease to be a disaster.

The same applies in the case of tied cottages in agriculture. The reason for the pressure for tied cottages to be made permanent homes for agricultural labourers is that everyone knows that if they lose their jobs and lose their homes at the same time they will be in serious difficulties. Let us put that matter right by making it easy for people to find accommodation. If we made better use of the existing housing stock, we should go a long way to meeting the problem.

What are local authorities doing about this matter? I should like to think that they were now better aware and more sympathetic to the special needs of people who have dropped to the bottom of our society and are in real need. There is discussion of this matter in the Finer Report. The House ought to be more fully aware of the accommodation problems and the cash problems of one-parent families. Let us imagine the case of a woman who feels in despair in her married life and must leave her home, perhaps because of her husband's cruelty, or in the interests of the children, and so on. If not even the furnished sector is available, what can she do? Local authorities will have to take note of these problems and see to it that their subsidies go mainly, if not exclusively, to those in the greatest need. That is not happening now.

What are the Government doing about this matter? I have said briefly what I think they ought to be doing. The whole structure of housing allowances and subsidies must be rationalised and made fairer. Then there is the question of the supply of accommodation. If the Ministers who dismissed my suggestions with such disdain when we debated this matter a fortnight ago have thought again, I hope that they will be ready to tell the House what their solution is, and not simply to feed us doctrinaire and largely irrelevant maxims of their own.

I foresee that the Bill will solve a certain number of desperate problems, about which hon. Members know, but will cause much greater problems, even in the quite short term. We are facing a crisis in accommodation already. The Bill will make it worse.

Mr. Deputy Speaker

Order, Before I call the next speaker, may I remind the House this this is only a short debate and that a number of hon. Members on both sides of the House wish to speak. It would be helpful if speeches were confined to 10 minutes.

8.39 p.m.

Mr. Robin F. Cook (Edinburgh, Central)

I note your observation, Mr. Deputy Speaker, and I shall endeavour to be helpful.

I agree with the hon. Member for Kensington (Sir B. Rhys Williams) to a point, in that one can criticise the Bill as being yet another Bill in a series of piecemeal housing legislation presented to the House, which has meant that on each occasion we have been asked to decide on a particular aspect of housing. in isolation from other aspects. I agree that many of the housing problems into which we have blundered have arisen because we have been treating individual aspects of housing without seeing the overall picture. I hope that when we return in the autumn we shall be faced with more comprehensive legislation, dealing in particular with housing finance.

I welcome the Bill within the limited context which it sets for itself. It will bring immediate relief to a serious social problem, the extent of which we should not underestimate. If any hon. Member is in doubt about the reality of that prolem he should go to the Library and consult the latest issue of Social Trends, in which he will find that whereas furnished tenants make up less than 5 per cent. of all forms of household, they account for 38 per cent. of applications to housing aid centres and 25 per cent. of all admissions to emergency accommodation.

Moreover, the problem is worse than the national figures suggest, because it is localised in major cities. I hold no brief for London, but I understand that in London two-thirds of all those admitted to housing waiting lists as homeless are from furnished accommodation, and the scale of that problem interferes with the efforts of boroughs in dealing with other housing problems, such as slum clearance.

The situation is getting worse. Figures for applications to rent tribunals for security of tenure show an alarming increase over the past three years. In 1971 there were a mere 7,000 applications in the nation as a whole, but in 1973 the figure was nearly double that.

The Bill will benefit those who suffer from these problems. I have no doubt about that, but the point has been put—and it is a serious point—that against this we have the larger problem that it will bring about a reduction of units available for furnished letting. It is important to realise that the distinction between furnished and unfurnished letting is largely spurious and did not exist before 1965. Private lettings as a whole are in a decline, and that decline goes back to before any attempt in 1965—or indeed in this year—to control occupation. If any hon. Member doubts that, I shall be happy to take him to places in my constituency where private furnished tenants were put out on the streets in the past two or three years—long before this policy became part of ourmanifesto—

Mr. Rees-Davies

The hon. Gentleman says that the distinction is spurious, but it is not. The unfurnished tenant wishes to let on a fairly long basis, yet in the main cities the overwhelming proportion of furnished accommodation consists of tourist accommodation. There are people who deliberately let for three, six or nine months in order to reap turnover and provide accommodation on a regularly moving basis.

Mr. Cook

I shall be pleased to take the hon. and learned Gentleman to some places in my constituency. He will see the gentrification and movement occupation, and meet some of the tenants who have been put out in the past two or three years. He will be disabused of the notion that they were involved in holiday or short-term letting and did not want to stay in their homes permanently. The hon. and learned Gentleman's argument does not take account of the interesting fact that there has been a rapid movement from unfurnished to furnished lettings in the past nine years, and it is hard to believe that that is connected with an increase in British tourism. It was simply a measure to evade rent protection and security of tenure which was put into the Rent Act 1965. That can be checked by looking at the amount of furniture provided in some properties. The inadequacy of furniture in some properties is deplorable. For instance, a survey by the Child Poverty Action Group showed that of 41 flats which had been considered by a rent tribunal 32 were legally unfurnished. Why has there been this flight from the unfurnished to the furnished sector since 1965? The answer is that it has been done to evade the provisions of the Rent Act 1965, regarding not only security but rent control. The Rent Act 1965 was something of a fraud in this respect, in that it pretended that one could control rent without giving security of tenure. We all know the result of that. In the great majority of cases where furnished tenants have gone to rent tribunals to obtain a reduction of rent or six months' security of tenure, they have been promptly evicted in the seventh month.

My constituency agent went through a difficult two-year period. He went to the largest letting agency in Edinburgh, obtained a furnished letting, went to the tribunal, had the rent reduced, got his six months' security of tenure, and was then evicted in the seventh month. He then went to the second largest agency and went through the same process, getting his six months' security of tenure and being evicted in the seventh month. He went to the third largest letting agency in Edinburgh, went through the same process, got his six months' security of tenure, and in the seventh month was evicted yet again.

The embarrassing thing for this man was that by this time he had been round the three professional agencies which, between them, controlled 75 per cent. of all privately let dwellings in Edinburgh. It was impossible for him to find any alternative accommodation. He, like the right hon. Lady the Member for Finchley (Mrs. Thatcher), was fortunate in being able to solve his problem by becoming an owner-occupier. Not everyone is so fortunate. It is because of those who cannot afford that solution that I welcome the Bill.

As the Bill is before us essentially to stop an evasion, namely, that of the Rent Act by providing furniture, it is important for the House to scrutinise the Bill carefully and ensure that alternative methods of evasion are not being created. I am sorry to say that in the Bill as it stands there are plenty of alternative methods of evasion.

There is, first, the question of the resident landlord. I shall not dwell on this generally, because I suspect that other hon. Members will wish to do so. I wish, however, to make one specific point which is connected with Scotland. The Bill is nonsense in Scottish legal terms in its definition of a resident landlord. Most urban accommodation in Scotland is provided by tenements which may, under one roof, provide between 16 and 20 separate self-contained flats. Under the Bill as it stands, those 16 to 20 self-contained flats will be treated as one dwelling.

This is a serious point, because it is common in tenements in Scotland for one owner-occupier to let out one or two other flats on the same stair. For the purpose of the Bill he will be treated as a resident landlord. That is nonsense, because all the flats are totally self-contained.

I come to the two main points of evasion that I wish to deal with. The first is the question of flats available for holiday lettings. We have in Scotland, in the Islands, the Highlands and in the Borders, a growing and serious problem of summer homelessness. Families who work on the land and who can obtain accommodation in the winter find that that accommodation is required during holiday periods and they have no alternative but to sleep rough or camp. I am very doubtful of the social value of denying such families the right to security of tenure.

The House has recently taken a firm line on the question of second homes and decided to withhold improvement grants in connection for work thereto. It seems paradoxical that so soon after the House has taken that firm line it should be encouraging holiday lets in this way. I am concerned not only about the issue of substance but about the fact that this will provide yet another pretext for evading the rent protection provisions in Scotland.

My hon. Friend the Minister said that there are already cases of landlords bringing pressure to bear on tenants to evict them before the Bill reaches the statute book. It is right that my hon. Friend the Minister should be made aware that there are already cases in which landlords are taking evasive action to avoid the consequences of the Bill should it reach the statute book.

Shelter has established emergency provision for taking care of some tenants who are faced with eviction as a consequence of the publication of the Bill. It reports that already it is having cases brought forward from not very salubrious areas of London, such as Notting Hill, where landlords are going to tenants and saying that they want written into the let the provision that the accommodation is a holiday let.

In my constituency there is a dwelling composed entirely of bed sitting rooms and inhabited by manual workers who have been there for some time. Each of these manual workers is employed in Edinburgh. Each has been asked to sign a document saying that he is on holiday. The Bill must be strengthened to prevent any evasion such as this.

The other point of evasion that I wish to deal with concerns students. As has been indicated, in the original form of the Bill students were exempt if they were living in property provided by an educational establishment. As I understand it, the amendment—I have not had an opportunity to see it in printed form—exempts them as a class. I appreciate that the function of the amendment was to try to help students by making more accommodation available. I have many student constituents, but I doubt whether it is in their interests for there to be such discrimination in legislation.

I am moved to ask whether there are any precedents for such discrimination. I am moved to ask, more seriously, when students will next be discriminated against as a class as a result of this precedent. It is interesting, significant and right that the National Union of Students should be concerned about the proposed amendment.

But though there are many educational establishments in my constituency—indeed, because they are there—I must be concerned about my other constitutents. If the Bill goes through with the amended clause my other constituents will be in an impossible position in terms of competing with students for privately let accommodation. They will be able to get security of tenure, whereas the students will not. Therefore, the landlord will always give priority and advantage to students. There is, of course, a pressing problem of student accommodation. It is not a problem that will arise for the first time this coming winter; it has existed in Edinburgh for some years. It is primarily the responsibility of the universities. They should take steps to remedy it and not rely on the privately let sector to take care of their students.

Not only will the Bill, as amended, materially affect the situation in substance; it will provide another pretext for evasion. If those of my constituents who are manual workers find that their let specifies "holiday", I see nothing to stop the let also specifying that the tenant is a student. That is another loophole that will have to be stopped. That may be what the landlord will wish to put into the contract of letting. The right hon. Member for Finchley will probably ask why those who seek the accommodation do not resist. The answer is the same as that which applies when a High Court judgment is suggested. The fact is that the people concerned are ignorant about their legal rights. Moreover, they are desperate for accommodation.

I welcome the Bill, but I say that we must keep this measure in perspective. It is a Bill which simply stops a gap. It leaves a lot of other gaps available. I hope that some of them will be stopped up in Committee. However, although we may try to avoid the gaps appearing they will reappear because we have a housing shortage. Given that situation, strong pressure will be put upon tenants to consent to a fraud on the part of the landlord so as to get accommodation.

The truth of the matter is that the private landlord is dying. I believe that it is impossible to resuscitate him. The duty of the Government should be to make his death throes as painless as possible for society. That means ensuring that dwellings are available to let within the city centres from housing associations, local authorities and co-operative societies. That would be a major reform. which I hope to see effected as soon as possible.

An eccentric effect of the Bill is that the only category of tenant now devoid of any security of tenure is the local authority tenant. This is a disgraceful situation. It is true that local authorities are constrained by moral and political considerations in a way that private landlords are not, and that they normally behave responsibly. There are not many cases of local authorities irresponsibly evicting tenants. Nevertheless, local authority tenants have a right to say to us "If our security of tenure is recognised morally why is it not recognised legally?" I hope that the Government will find an early opportunity to recognise their security of tenure legally.

8.55 p.m.

Mr. W. R. Rees-Davies (Thanet, West)

I should at once correct the hon. Member for Edinburgh, Central (Mr. Cook) on one matter. The local authorities are by no means the only landlords free of control. Apart from housing associations, there are Her Majesty's Forces, the National Health Service and certain other sectors of the Civil Service. Unfortunately, the same is true of the National Coal Board, one of the biggest property owners in the country. Insurance companies, too, are excluded. Over 55 per cent. of this type of accommodation even today is in the hands of housing associations and other such bodies.

It is time that the real purpose of the Bill was plainly stated. My right hon. Friend the Member for Finchley (Mrs. Thatcher) made an attractive and moderate speech, leading for the Opposition, but mine will not be nearly so moderate or so kind. I am fed up with the poppycock we hear from the hon. Member for Mitcham and Morden (Mr. Douglas-Mann), who used to represent a Kensington constituency and who talks such nonsense about the wolves at the door. The wolves at the door in his constituency are a small number of Pakistani and West Indian immigrants who have created a most unfortunate situation in certain isolated cases.

Repeatedly, the hon. Member for Mitcham and Morden has said that he wants to see the end of the private landlord. Apparently, he believes that no one is entitled to own any house other than the one he lives in. A man can have £1 million worth of paintings, he can own anything he likes, but if it is his pleasure to own a few houses and, perhaps, to let one or two of them for the benefit of others, whether at reasonable rents or not, he is, according to the hon. Gentleman, behaving in a way which, in terms of capital, calls for decapitation. He has said it clearly enough on several occasions.

Mr. George Cunningham

Come on—be serious.

Mr. Rees-Davies

I am being deadly serious. Labour's programme in 1973 said: The next Labour Government will extend security of tenure to furnished tenants. This will be just a stop-gap until a programme of municipalisation has been carried out". That was on page 47 of that document. The purpose of the present Bill is quite deliberate. It is to occasion immediately an acute shortage of furnished accommodation so that the municipal authorities may take over the properties, the task of municipalisation then being all the easier. The true purpose of this deliberate reduction in rented accommodation is to create scarcity so that the Labour Government may arrange for the take-over of the remnants of rented property. The task will be easily accomplished in that way.

Those of us who have had many years of experience of the law of landlord and tenant, as I have had and continue to have, realise only too well what the Socialist purpose is: it is a Socialist takeover of all remaining properties in the hands of landlords, excluding owner-occupied premises, in which case, in the Socialist nomenclature, the landlords are not landlords. A landlord, according to Socialist philosophy, is a person who rents houses, not the one which he occupies.

Another Socialist purpose is to restrict the movement of people from one local authority area to another. The Bill is skilfully designed to prevent the prospective tenant from moving out of the local authority area in which he is domiciled. Furthermore, it carefully ensures that those who really desire accommodation today cannot possibly have it. The difficulty today is for the newly married couple, the young professional person, young people starting out in work—nurses, social workers, solicitors, doctors and all those who need to be in central accommodation. These people are not able to obtain council accommodation. There is no provision for them. None of them is able to afford to become an owner-occupier. They do not have families which could qualify them for accommodation provided by housing associations or societies. Not one of them, therefore, will have priority of any kind.

It is this Government's intention now to squeeze these people until it hurts and to make sure that they are unable to get any accommodation in our cities. Those who happen to be sitting tenants at present will willy-nilly be given protection. They are to be given protection notwithstanding the fact that in the current year there is a rent freeze so that the landlord is unable to put up the rent. Whether it is proper to do so or not, he cannot do it. And now the Socialists have the impertinence to say that a man is a wolf if he wants to get back his own house before the Socialists take it over.

I should have thought it ordinary common sense and fairness that a person should be free to decide whether he wanted his house to be the subject of such a take-over, or whether it should be done by stealth, behind his back and without proper notice.

The fact is that the Government are serving notice that it is their intention to take over all private rented accommodation in the event of their winning the next General Election. As practically no one qualifies for council flats, I want to point out exactly what the situation is. I have some knowledge of these matters in one respect. I have three or four flats which I let furnished. These are real furnished flats—that is, not the type of accommodation with which some have been concerned in this debate. What we have heard so far is that in North Kensington and Willesden, with which the Minister is so well conversant, in Edinburgh and in one or two other city areas, there is a certain amount of accommodation which is substandard. It is not correct to call it proper furnished accommodation. Much of it is in the hands of immigrant families who do not appreciate the law and in many cases do not appreciate the standards we would like to see.

I recognise that there is that problem. But the way to handle it is exactly the reverse of the policy being pursued by the Government. The way to handle it is to say that if people create accommodation from their homes or sell off or buy property which they are prepared to put on the market as furnished accommodation, provided it is furnished to a proper standard it can be let free of control. That way we shall get a great deal of it. That is what we need in central London, Edinburgh and other cities.

Let it not be said that I have ever been on the side of the landlord, because I led the rebellion many years ago against my own party in this House in favour of the professional tenants. I kept that rebellion going for a long time against the then Henry Brooke. I am not one of those who favours the landlord. I favour giving opportunities to young people in the cities to get accommodation. This Bill will not give them one extra room of any sort—quite the contrary. It will rapidly dry up the supply of accommodation.

We shall also be faced with the position—and this must be cleared up in Committee—of those who let their property for a period of six months certain, on a definite secured tenancy, intending to take up occupation thereafter. I have in mind members of the Civil Service and the Foreign Office, and university professors who go on sabbatical leave for six to nine months. As I read the Bill such people will not be able to go back and obtain occupation of their homes.

The Bill is a terrible muddle. It is a Bill by reference. It requires a skilled lawyer to read it. Every single line of it refers to the Rent Restriction Act 1968. I had to go back and relearn all my old Rent Acts just to read the Bill. That is unfair on the public and on this House, particularly when Labour hon. Members call a strike as a result of which we cannot get the papers with which we work.

Mr. Kaufman

Disgraceful!

Mr. Rees-Davies

Oh, yes they have. They know perfectly well that they could employ non-union labour and see that this House works properly. I do not see why we should be trying to work for the benefit of the nation without the tools to do the job.

The Government ought also to be sure that those serving in the Armed Forces overseas and others can get back into their homes.

There are two other points I wish to raise. The first concerns the tourist industry and in particular seaside resorts. I have spoken to many of my hon. Friends who represent seaside resorts and they all agree that, as it stands, this Bill will not do.

Mr. John Cordle (Bournemouth, East)

Hear, hear.

Mr. Rees-Davies

I am delighted to see my hon. Friend present. A great many other hon. Friends were present earlier. It is only because there is to be no vote on this Bill and because it is a relatively short debate that many of them have wandered away. But that does not mean that it is not a very serious matter to everyone. [Interruption.] If the hon. Member for Islington, South and Finsbury (Mr. Cunningham) had wanted a two-day debate, no doubt he would have informed the Minister and we would have been pleased to have it. But there are other important matters to be dealt with later in the week.

It is not sufficient to say that those who indulge in holiday lettings may be able to recover their property. We must go further and ensure that they are able to do so. Those who regularly let throughout the summer feel that they are in grave danger about being able to let accommodation in the winter. There is a progressive amount of winter holiday letting in, for example, Bournemouth and Brighton. We have a considerable number of winter holiday lets in Thanet. Lettings are made to nurses and to other local hospital staff. Lettings are made to people who come from overseas—if not holiday lettings, then lettings for education purposes.

I am satisfied that the only way in which to deal with the question of the seaside resorts is to say that any boarding-house keeper, hotelier or other person engaged in holiday letting should register the fact and if it is a bona fide letting for that purpose he should be exempt for the whole 12 months.

The Bill is ill-conceived because it is basic to the Labour Party's philosophy. If right hon. and hon. Members opposite decide in principle, as they have done, to end private landlordism and to ensure that the local authorities purchase all the houses and rooms in the private sector, what does it matter to right hon. and hon. Members opposite whether the Bill is well or badly drafted? The more badly drafted it is and the greater effect it has in drying up the supply of accommodation, the better opportunity it gives local authorities to take over the accommodation in Westminster, Edinburgh and in other cities and to do the necessary conversions and secure the lettings.

The hon. Member for Luton, West (Mr. Sedgemore), who is a councillor in Putney, has always advocated that the large houses on Wimbledon Hill should be taken over, split into flats and sold for council housing purposes. Does the Minister deny that that is part of Labour Party policy, as it has been part of the council's policy in Putney?

There has been no consultation with the chairmen of the rent tribunals. The Government have flown in the face of the Francis Committee, which the Labour Government set up in 1969, and which said that it ventured to sound a solemn warning against giving security of tenure for furnished lets. The committee's main recommendation has been flouted. There is not a jot of evidence to show that owners of furnished accommodation wish to evict their tenants. If they are forced by the Bill to keep them for ever, they will want to get rid of some of them now because they are nuisances and cause annoyance.

But in general the purpose of letting furnished accommodation is to have a regular turnover. People want to improve their accommodation. They want to let, not only to young people and others in this country, but to people from overseas. Much of the accommodation which can be obtained through the English Tourist Board is occupied by foreigners, not only in hotels, but in furnished flats and "digs" where they are able to stay for a few months before returning to their own countries. That is to be denied to them. The only evidence of harassment and extortion is in the immigrant accommodation, and this Bill will do nothing to cure it.

9.10 p.m.

Mr. Paul Tyler (Bodmin)

I agree with the hon. and learned Member for Thanet, West (Mr. Rees-Davies) that the Bill is extraordinarily complex and difficult for the layman to understand. I disagree with almost everything else he said. I want to make a plea for speed, brevity and clarity. It is therefore desirable that I should be speedy and brief.

As the background to the Bill there is an extremely difficult and complex housing situation. Because the housing shortage has appreciably worsened in recent years, the urgency of the Bill must be manifest to all. The relationship between landlord and tenant is often a good one but, unfortunately, as we have learnt to our cost over succeeding years, when that relationship goes wrong it goes badly wrong. That is why we have to make sure that the law provides for the good relationship and also for preventing the very bad relationship. That is where the Bill has a rôle to play. It is important to restate that we are dealing with the minority who abuse the situation because that may help us to approach the Bill and all the legislation that has preceded it and will no doubt follow it.

I agree with much of what the hon. Member for Edinburgh, Central (Mr. Cook) said. His contribution to our discussion was excellent. There is one overwhelming reason why the Bill is a necessity. It is no longer appropriate to approach a large section of our housing provision on the basis that nil security is acceptable to the person who wishes to have a permanent home. That is a contradiction in terms.

As the House knows—I have declared this interest previously—I have for some years helped the Royal Institute of British Architects to understand some of the complex matters which come before the House. To some extent I continue in that rôle, but I am glad that I do not have the responsibility of explaining the Bill to the institute. The references back to the 1968 Act are difficult, and it would be inappropriate to detail all the other loopholes and potential difficulties which may more appropriately be considered in Committee.

I wish to concentrate on two specific problems. The first is the question of resident landlords. The Bill is too weak. I hope that when the Government approach this problem in Committee they will find some way of tightening it up. My noble Friend Lord Avebury in another place moved an amendment which was based on the Francis Committee's recommendation of the definition of a resident landlord with one sole tenant. It is the landlord with one sole tenant to whom we are concerned to give protection. It is not the landlord who happens to occupy one flat in a block of perhaps 50 or 100 flats with whom we are concerned, because the relationship there is commercial and there is no need for him to let part of a property for personal reasons.

There are alternative definitions which have been used in the Race Relations Act 1968 and the Housing Act 1969. I understand that there are objections to those, and no doubt we shall hear those objections in Committee. I prefer my noble Friend's definition. If we possibly can, we must deal with this problem before the Bill becomes law, otherwise there will be a loophole for the unscruplous landlord.

The hon. Member for Edinburgh, Central referred to the other matter to which I wish to draw attention—the definition of holiday letting. That is important for the south-west of England, and especially for Cornwall. I am not quite sure how we should deal with it. This is a difficult problem, which is made worse by the collapse of the house building programme over the last few years—in both the public and private sectors—in many rural areas which also have a tourist industry. In my constituency some tenants and landlords are in considerable difficulty because of lack of clarity in the law.

I fear that if the Bill is passed in its present form the law will be no clearer. Let me take as an example a landlord who, with perfectly good motives, let accommodation during the winter only to find that when the time came for his first holiday letting in the summer his tenants were still in occupation. He found it extremely difficult to evict them. He does not want any publicity in trying to evict them, and he is stuck with the situation. On the other hand, many tenants in my constituency are put at a disadvantage, since they have taken rented accommodation near to their jobs and find themselves with no security of tenure whatever. This is an extremely difficult problem. Landlords and tenants—and even potential holidaymakers who at short notice find their holidays cancelled—would welcome a clarifying of the situation. Therefore, I very much hope that the Bill will be improved in Committee.

In the last few months the south-west of England, and Cornwall in particular, has become a housing stress area. The relationship between second homes, holiday lettings and such small reserves as we have of rented accommodation puts a great strain on our resources.

Finally, I am concerned about the speed with which the Bill will be brought into action once it has progressed through Parliament. I understand that the period of time was originally four weeks, but that that time scale has now been reduced to two weeks. What will happen in that two-week period? An extraordinarily difficult situation could arise, involving harassment and awkward relationships between landlords and tenants. Why could not the measure have been introduced the day after it received the Royal Assent? I understand that there is a precedent for this in the Protection from Eviction Act 1964. I hope that the Government will look at this matter again.

I should like to give the Bill a welcome. I recognise that it is most important that the measure is polished to a point where it can be understood not only by lawyers but by landlords and tenants, who have a right to be able to understand legislation that affects them.

9.18 p.m.

Mr. George Cunningham (Islington, South and Finsbury)

In the two or three minutes left for back-bench speeches I shall restrict myself to a couple of points, and I hope the House will forgive me for making them in staccato fashion.

It was suggested by the honourable and allegedly learned Gentleman the Member for Thanet, West (Mr. Rees-Davies) that the Bill would add no single unit of accommodation to those already available. This simply will not be true of a certain class or group of people in my constituency. Whether one adds security or takes it away does not physically add any rooms to those available, but the problem we face in Inner London is that accommodation continues to be available, but not to the people who traditionally have lived in an area. Unless we preserve a significant part of the residential accommodation in Inner London for those people who cannot afford the colossally high prices of accommodation in Inner London, the services of London will not work. We shall be left with a situation in which only the very well off—and perhaps in our case the badly off—will continue to live in Inner London.

My second point relates to the definition of a "residential landlord". In view of the awful state of the text before the House—I do not blame the Government, for it is nothing to do with them, but it is the job of the administrative services of the House to get this right—I have tried to look at the amendment carried in the other place on the definition of a "residential landlord". I hope we shall take another look at this matter in Committee. I can think of several cases where the residential landlord would be undertaking a commercial operation perhaps with as many as half-a-dozen tenants in linked but totally self-contained accommodation where security would not apply because of the wording used in the amendment carried in the House of Lords.

I should have thought that what we should be aiming at in principle, although it might be more difficult to express it in language suitable to the statute, is that, where there are completely self-contained flats, occupation of one of those flats by the owner should not take away security from the occupants of all the other flats. I cannot think that securing that situation is beyond the skill of the parliamentary draftsmen.

9.20 p.m.

Mr. Hugh Rossi (Hornsey)

The form taken by this short, sharp debate has been predictable. Hon. Members on both sides of the House have a real and deep-felt concern for the homeless, for the young looking for a place of their own to start new families, and for the poor unable to compete economically, for housing in short supply, with those who are better off. The objectives which concern us are similar, but it is in seeking a solution for these very human problems that divergence begins, and we have seen evidence of this in the debate.

On one side of the House there is a dogmatic belief, held with an almost religious fervour, that the solution lies in subjecting rented homes to rigid control, so that the conditions of those already in accommodation, whether it be good, bad or indifferent, in terms of their needs, remain frozen or, to use a more apt term, fossilised. On the other side of the House there is the equally strong belief that an excess of controls and the fossilisation of rented accommodation ultimately worsens the situation, since it both acts as a disincentive to the provision of housing by those able to provide it and extends little hope to those who will be seeking homes in the future.

I accept the sincerity of those who propound the view that in areas of housing stress especially it is necessary to provide a firm measure of protection to families living in the limited amount of rented property available. Such families are those most economically vulnerable and forced by circumstances both to live in dreadful conditions and to pay a disproportionately large part of their incomes for the doubtful privilege.

Those who work for Shelter, for SHAC, for the Child Poverty Action Group and for many similar bodies performing an invaluable task, have to contend, day in and day out, with the most heart-rending cases, and it is easy to understand why many of them believe fervently that there must exist a legal machinery whereby families which come to their notice can be protected both from financial exploitation and from the constant nagging fear and worry of losing that little which they call their homes. Any hon. Member who represents an inner urban area cannot be but intensely aware of these problems and responsive to the pleas of those working in the field.

I believe—I know that all my right hon. and hon. Friends are with me—that in such areas where the worst conditions exist a strong measure of help must be given to such families. However, whether the best kind of help is to say as a universal proposition to the majority of tenants in every area that their rents will be fixed and that they cannot be asked to leave except in the most extreme cir- cumstances is very much open to question. It is a simple solution and, on the face of it, it has immediate appeal to those who have to contend with the desperate and almost impossible task of rehousing families where there is virtually a non-existent supply of decent alternative accommodation.

Some of us believe the problem to be far more complex than this kind of simple solution would lead one to believe. Insecurity is interwoven with the need to increase the supply of accommodation available and with the need to ensure that the supply is maintained in good and habitable condition. This is intricately bound up with the financial ability of the tenant to pay and the incentive for the owner to provide.

The last administration tried to give help to those families unable to pay fair rents by rent allowances in both the private furnished and unfurnished sectors. Perhaps the allowances were not generous enough, although I have heard little criticism of them. Perhaps they were not sufficiently widely known. Perhaps the scheme was not in operation long enough for its full benefits to be felt.

Whatever might be the shortcomings, we on this side of the House are firmly convinced that, given time and any necessary adjustments, rent allowances would remove a great deal of the landlord and tenant conflict which has bedevilled some areas of housing in the past. A landlord assured of a reasonable rent by a tenant given the ability to pay will be willing to keep his tenant and more owners will come forward with accommodation to let. Deny the owner a reasonable rent by law and, if he is an unscrupulous landlord, he will seek ways of evading that law, or, if he is a scrupulous landlord, he will simply cease to rent at the first opportunity.

Mr. George Cunningham

Will the hon. Gentleman give way?

Mr. Rossi

No. I have very little time.

The supply of accommodation is the key to the whole problem. The Minister for Housing and Construction pins his hopes on the provision of accommodation by local authorities. I believe that he is living in a world of fantasy.

First, by its very nature local government, which is slow and cumbersome in its movements by its reference from one committee to another, is far too cumbrous to give the help quickly where it is urgently needed.

Secondly, the scale of the operation is such that public resources simply are not available.

Thirdly—this point was made by my right hon. Friend the Member for Finchley (Mrs. Thatcher)—the present crushing tax and rate burden is such that it has little tolerance for a further heavy load.

Fourthly, whether we like it or not, we are undergoing the most tremendous economic difficulties, teetering on the edge of the precipice of national disaster, and it would not require much of an acceleration in public expenditure to push us over. Therefore, whether we like it or not—that hon. Gentlemen opposite do not is certain—we must recognise that in combating our housing problems we shall have to rely for many years to come on the private sector. Indeed, the dire necessity is to encourage, not discourage, the private sector.

Hon. Gentlemen opposite have pointed to the diminishing supply of unfurnished rented accommodation over the post-war years almost with a sense of satisfaction and at the same time to a slight compensatory increase in furnished accommodation. The fact that unfurnished accommodation has been under incessant control or the threat of statutory control whilst furnished accommodation has not points to a lesson which many of my hon. Friends have underlined this evening.

Reference has been made to the Francis Report and to the solemn warning that it gives against the extension of rent controls and security of tenure. I invite the attention of the House to another report from which other lessons may be learned. I refer to the Milner Holland Report, published in March 1965 after the most extensive investigation that there has ever been into the effects of the Rent Acts upon housing stress areas.

At page 93 it will be seen that at the time of the survey the great majority of young people lived in privately rented accommodation. Nearly half of these, where the head of the family was under 30, lived in furnished accommodation and half in decontrolled unfurnished accommodation. Only 3 per cent. had controlled tenancies. By contrast, elderly people over 60 enjoyed the highest proportion of controlled tenancies. Two-thirds of these households had controlled tenancies, and three out of five had a whole house or flat to themselves. The young people were trapped in furnished accommodation in areas of housing stress in conditions of multi-occupation and overcrowding from which they were unable to escape because mortgages were outside their grasp. That was written 10 years ago.

The lesson to be drawn from Milner Holland is that controls were no help to those young people. Existing controls had frozen or fossilised accommodation in the hands of those it was in at the point in time at which the controls were imposed, namely, those over 60 by the time the report was published. These elderly people could not move out of their accommodation, even if it was too big for them, because all other unfurnished accommodation was similarly fossilised. The controls made no provision for the new families coming along. Indeed, were it not for the area outside housing control they would have had no homes at all, and what we are going to do under the Bill is to put that area under control.

This experience is not confined to the United Kingdom. If hon. Members care to look at essays by Professor Hayek of Salzburg, Professors Friedman and Stigler of Chicago, Dr. Sven Rydenfelt of Sweden and Bertrand de Jouvenel, they will see that wherever rent controls are imposed to combat housing problems as a temporary expedient, be it in Vienna, San Francisco, Stockholm or Paris, the results are identical. The controls remain as a permanent feature of legislation, perpetuate and increase the housing shortage, encourage immobility, foster dilapidation of housing stocks and erode production incentives.

The cumulative advice of all those reports—English and foreign—essays and experiences is formidable, and we ignore it at our peril. It is in the light of this advice and these experiences that we must examine the legislative proposals before us.

Clearly, we must be highly critical of any extension of control the result of which would be to reduce the supply of badly needed accommodation. At the same time, we could not contemplate the complete abandonment of controls and of allowing the free play of supply and demand to produce rented accommodation as a commodity. The sudden and uncontrolled correction of years of distortion would cause an upheaval and hardship too great to contemplate.

Therefore, the legislative need is something else. There is a need, on the one hand, to protect the homes of economically vulnerable families in times and areas of stress. On the other hand, there is a need to enable the owner of property to feel reasonably free to regain what is his when it is fair and right that he should have it. Insufficient legal protection of the tenant leads to exploitation of the lower income sections. Too much protection leads to hardship amongst the poorer landlords, who form the majority, and makes them the victims of unscrupulous tenants.

The almost intractable problem is how to legislate so as to strike a fair balance between those competing needs, and so as to minimise the exploitation of the law either by bad landlords or by bad tenants, but in whatever direction one moves there will be a conflict with vested interest.

It is, therefore, to this extent that I welcome that part of the Bill which intends to give greater rights to landlords who let part of their own homes. It is here that the greatest social difficulties have arisen, and it helps no one to perpetuate a situation where people living in the same house are constantly at one another's throats. But whether the Bill goes far enough in this direction is another matter, and we shall wish to examine much more closely the proposition that up to one year's security of tenure may be given by rent tribunals in such circumstances.

The hon. Member for Mitcham and Morden (Mr. Douglas-Mann) raised this point in his speech. I refer the hon. Gentleman to the fact that Clause 2 is silent on the question whether Part VI of the 1968 Act applies. If that part of the 1968 Act applies, Clause 7 of this Bill will apply, extending the security of tenure that rent tribunals can give to both furnished and unfurnished accommodation where there is a resident landlord.

The result will not be, as the hon. Gentleman said, to make it easy for landlords to get back their homes, but will make it much more difficult, because there will be an application to a rent tribunal, a year's security—which, under the 1968 Act, can be renewed for another year—and then another year, and then yet one year more, and it will not be until the rent tribunal has decided not to continue with this process that the landlord can go to the county court, and then wait three or four months before he knows whether the county court judge will give him a possession order.

Mr. Douglas-Mann

rose—

Mr. Rossi

I cannot give way, as there is insufficient time. The hon. Gentleman will recall that he did not give way to me during his speech.

I have also for a long time believed that there was a need for the fusion of the machinery for dealing with furnished and unfurnished accommodation. The distinction between the two is artificial and fraught with legal difficulty. Statute requires that to constitute a furnished letting the furniture must form a substantial part of the rental value. There is no accurate yardstick for determining what is substantial, and the law reports abound with marginal cases. Reference has been made in this debate to Woodward v. Docherty and it has been suggested by the hon. Member for Mitcham and Morden that that case represents the law as it has stood for a long time. I would refer the hon. Gentleman to the case of Sagoo v. Goel, decided in 1969, where he will find that an entirely different position appertains. That was followed by rent tribunals for years.

Mr. Douglas-Mann

rose—

Mr. Rossi

I am sorry; I cannot give way. The hon. Gentleman would not let me intervene on that point in his speech.

Whether it is right, as the Bill proposes, to transfer the jurisdiction in most cases from the rent tribunal to the rent officer, or the other way round, is another matter which we shall wish to examine. I at one time believed that the correct method of doing this, after fusion of the two kinds of rented accomodation, was to start with the rent officer, with an appeal to the rent assessment panel, but after reflection I am not so sure whether this is the right solution. My present information is that rent officers, particularly in London, are overburdened. Recruitment is extremely difficult, despite advertisements in local government journals offering salaries between £3,500 and £4,000 a year for persons not required to show any qualifications. There are 20 advertisements for rent officers in today's daily Press.

There are delays of up to nine months between applications to rent officers and their finally reaching a decision. It seems to me in a sense absurd to place an even further burden on this administration which inevitably is undergoing a great strain at the moment. On the other hand, rent tribunals normally deal with a case within four to five weeks, and by their composition are well suited to deal with every legal or other complication which may arise. In addition, there is always a lay person present to make sure that there is fair play between the specialists. The Francis Report speaks highly of the way in which rent tribunals cope with the very real human problems which are presented to them.

Therefore, I must give notice to the Minister that this is a matter which we shall wish to probe very carefully in Committee and we shall wish him to come armed with the fullest possible information. Nothing would be worse than to create a situation where landlords and tenants would have to wait for months to have their grievances resolved. Nothing would bring greater discredit on the whole system, inevitably leading to self-help, abuse and all the problems that that entails.

This raises another wider issue. There is something inherently wrong in a situation where a landlord or tenant has to go to three separate types of legal machinery to deal with separate aspects of the same problem. If a tenant or a landlord wants the rent to be arbitrated, he goes to the rent officer or rent tribunal. Neither can deal with any of the attendant problems which frequently become immediately apparent. If there is a question of harassment, or no rent book, the tenant has to go to the magistrates' court via the town hall. If there is a question of arrears of rent, or need for possession, or even of the validity of a notice to quit—and also the question of apportionment of rateable value which is important in furnished lettings where the rents are inclusive—the landlord or somebody has to go to the county court to have those issues determined.

All this leads to interminable delays, expense, frustration and a general feeling of inadequacy or unfairness in the legal system. I believe there is a pressing need for the establishment of a single tribunal acting with the minimum of pomp but with the maximum of informality and expedition which has the jurisdiction to deal with all these related matters—normally just the relationship of one man and another man under one roof. Nothing can be worse than the running sore of a dispute between landlord and tenant when all can be settled between them, often amicably, by an impartial and experienced arbitrator. Nothing would instil more confidence in landlords and a greater willingness to let than the feeling that they could rid themselves of very bad tenants quickly, before they suffered too much financial loss or damage to property.

There are many matters in the Bill which do not satisfy us but which I shall have to leave to Committee, including the whole range of discretionary and mandatory possession orders under Schedule 3 of the 1968 Act. In answer to the hon. Member for Mitcham and Morden, it is not our wish to filibuster. We are concerned with the many complex legal problems raised by the Bill and, as we have heard, hon. Members on both sides are not satisfied either because the Bill does not go far enough or because it goes too far. All these matters will have to be probed and if amendments made in another place are to be reversed, that will have to be discussed as well. I should be sorry if the Bill took longer in Committee than the hon. Member would like, but we have our job to do.

The Milner Holland Report said: The supply of privately rented accommodation in Greater London has diminished and is still diminishing fast. This trend will not be halted, still less reversed, unless investors can be assured that, provided their properties are properly maintained and managed, they will be free from the hazards of political uncertainty and able to obtain an economic return. This plea appears in Milner Holland: Housing has for too long been the sport of political prejudice. The need now is for a common approach to the problem and for a fully considered development of policy based on an understanding of the whole housing situation and purged of irrelevant prejudice against landlords, tenants or any other groups".

9.42 p.m.

The Under-Secretary of State for the Environment (Mr. Gerald Kaufman)

By my reckoning, this Bill marks the 18th fulfilment of an election manifesto pledge since the Government came to office. Eighteen pledges fulfilled in 18 weeks is not bad going. This pledge is the fourth on the Department of the Environment's list, a pledge which appeared in our manifesto as follows: We shall extend protection from eviction, to tenants of furnished accommodation. It sets the seal on Dick Crossman's historic rent and tenancy reforms. The Bill fills a gap which he always lamented that he had never filled himself. As one who worked as Dick Crossman's assistant for a number of years, I like to feel that in a small way I am carrying on his work.

The right hon. Member for Finchley (Mrs. Thatcher) justifiably lamented the shortage of documents. I deeply regret the reasons for this although I would dispute her contention that it is the Department's job to provide the documents in the Vote Office. If it is, almost every Department in the last administration fell down on the job. I remember having to photocopy all the enactments relevant to the Pakistan Bill when I served on the Standing Committee.

A number of hon. Members referred to the impact on landlord and tenant law of the case of Docherty. The right hon. Lady implied that that case made the Bill unnecessary. But such cases have to be fought through the courts at considerable expense and, if obtainable, with the necessary backing of organisations like Shelter, and the outcome is doubtful. The Bill is providing security of tenure, not as something to be won after a legal battle but as an undisputed right for the furnished tenant.

The right hon. Lady and I were involved in a dialogue on this matter. She was worried about what would happen to landlords of unfurnished accommodation who had a periodic tenancy. I completely acknowledge that the sheer mess with which we have to deal in terms of the Bill in its present form makes it very difficult to track this down. However, I refer the right hon. Lady to Schedule 2, 5A(5)(b) for the reference that she requires and to which, no doubt, we can return in Committee.

The hon. Member for Kensington (Sir B. Rhys Williams) and my hon. Friend the Member for Edinburgh, Central (Mr. Cook) both asked for a new subsidy structure to follow this legislation. I am glad that both sides of the House have such a thirst for the implementation of the policies of the present Government. I promise both the hon. Gentleman and my hon. Friend that this restructuring of subsidies is coming. The first stage will be in the forthcoming Rates and Subsidies Bill, which will be published soon and which is based on our consultation document recently issued.

My hon. Friend the Member for Edinburgh, Central also referred to a specifically Scottish point. I congratulate my hon. Friend not only on an outstandingly good speech but also on the fact that he spoke for Scotland. The Scottish nationalists were simply absent. Furnished tenants in Scotland, 46,000 of them, were abandoned by the Scottish nationalists, and it was my hon. Friend who spoke for them.

The Bill as drafted prevents security being extended to tenants in traditional Scottish tenements where landlords live in those tenements. That was the burden of my hon. Friend's point. He is perfectly right. That is a lacuna in the Bill. My right hon. Friend the Secretary of State for Scotland appreciates this problem and proposes to table an appropriate amendment to Schedule 2(2). Flats within tenement buildings will be specifically recognised as self-contained dwellings, where tenancies can attract security under the Bill. I am sure that Scotsmen will be very grateful to my hon. Friend for making this point in the debate and allowing me to clarify the benefit which this legislation will provide for furnished tenants in Scotland.

My hon. Friend the Member for Edinburgh, Central, supported by the hon. Member for Bodmin (Mr. Tyler), also voiced fears about the way in which the exemptions that we are providing for holiday lettings could be exploited. My hon. Friend and the hon. Gentleman were both worried about the dodges which would allow people to get round this provision. I assure them that this kind of dodge will not work under the Bill. The words The purpose of the tenancy in Clause 2(1)(bbb) should effectively prevent abuse of the kind to which my hon. Friend referred. This does not mean the purpose or the intention of the landlord or tenant individually, but the facts behind the tenancy agreement entered into by both parties. The fact that a landlord calls a letting a holiday letting, or persuades the tenant to agree that it is such a letting, will not prevent a court from determining on the basis of the surrounding facts whether a residential tenancy exists.

The purpose of the letting is a question of fact to be decided by the court on evidence, and in determining which the court would doubtless take into account such matters as the location, the likelihood of a person taking such a dwelling for a holiday, the length of the tenancy and the conduct of the parties. It is not a question which can be determined simply by the label given to the tenancy by the landlord or the tenant.

I also agree with my hon. Friend the Member for Edinburgh, Central, who covered almost the entire gamut of the Bill, in what he said about student lettings. My constituency contains many thousands of students, living in halls of residence and private lettings. I support him in being certain that it is necessary for us to get rid of the amendment which another place inserted into the Bill.

My hon. Friend also referred to the need to provide security of tenure for local authority tenants. I assure him that we have not forgotten this. The Government have been in office four and a half months and we are not doing too badly in our housing legislation. I am sure that in the years that lie ahead my hon. Friend will be well satisfied with further legislation that we bring forward. I assure him that enfranchisement of local authority tenants is on our list of objectives. My hon. Friend the Minister for Housing and Construction would not tolerate a Labour administration which did not provide such enfranchisement. I give my hon. Friend that assurance, even though it relates to eventual rather than immediate action.

The hon. Member for Bodmin was concerned about the delay in commencement of the Bill. I agree with him that any gap in this respect causes concern, but he will realise that we are going to accept and retain in the Bill an amendment, inserted in another place, which halves the delay in commencement. I say to the hon. Gentleman, without being over-bureaucratic, that it is necessary that there should be some time between Royal Assent and the coming into force of the Bill to enable its provisions to be generally known, and this is particularly important in a Bill as complicated as this. The Government intend to use the short period before the Bill comes into force to mount a vigorous publicity campaign to explain the facts in simple language, and to ensure that landlords and tenants know how they stand under the law. My hon. Friend the Minister launched that campaign today.

Before I conclude my references to points raised in the debate I should say that what was said by the Opposition Front Bench did not go unnoticed on the Government Front Bench. Hon. Members opposite seemed to be consumed in pessimism. We noted what they said about the ability of the public sector to provide the necessary housing in this country. That pessimism is fully borne out by the Opposition's record when in office, but we, on the other hand, are determined to reverse the disastrous trend in local authority housing for which the Opposition were responsible. I am happy to say that the results of our policies are already beginning to show, and that the upturn will continue.

I recognise the sincere concern of the hon. Member for Hornsey (Mr. Rossi) about the increased burden of administration which the Bill will impose. We are well aware of the problems involved, but we are also optimistic in that while extra work will be required because of the introduction of the Bill, at the same time the burden on the rent assessment services will soon be alleviated by the abolition of the rent scrutiny boards, and that will provide a good deal of spare capacity for constructive activity.

Hon. Members have voiced views about various inadequacies in the Bill, and I accept that they have some justification for doing so. But nobody, except possibly the hon. and learned Member for Thanet, West (Mr. Rees-Davies), who is idiosyncratic in his approach to many facets of life, could call the Bill vindictive. It carefully and rightly preserves rights for resident landlords. Now we shall be able to see whether all the under-occupied owner-occupied accommodation, which the hon. Member for Bristol, West (Mr. Cooke) often speaks about—we lament his absence—will be forthcoming. The Bill also carefully and rightly protects those who need to live abroad for a period and then come back and repossess their homes. We are fully conscious of the necessity for this protection and we have taken pains to help these people.

Further, the Bill carefully and rightly protects those planning ahead for a home which they mean to occupy when necessary. We recognise that the retirement Chamber along the way has had its views on this matter and we shall try to improve its amendment regarding this subject.

The good and well-intentioned landlord has nothing to fear from the Bill. Indeed, he emerges with his rights enhanced. At the same time, at long last the furnished tenant will emerge, when the Bill is passed, as a statutory tenant with his status guaranteed by statute.

This is very necessary, for these are tenants who often live in the worst accommodation, desperate for a home, often—far too often—exploited in their desperation. These are the legions of the lost in the deserts of the inner cities. I represent an inner city constituency. Fourteen per cent. of my constituents live in furnished accommodation. I heartily declare an interest in the Bill.

My hon. Friend the Member for Bolsover (Mr. Skinner)—one of the most discerning of my hon. Friends, which means that he is exceptionally discerning—somehow visualised that it would be necessary at this stage for me to refer to my constituency. I was saying that 14 per cent. of my constituents live in furnished accommodation. I had a letter from one of them only today which states: I am living in a one room flat with my granddaughter who is now married and staying with me and her husband is staying with his mother as there is no room here for him. My granddaughter is having her first child in 8 or 10 weeks time. The state of the house is getting on both our nerves with mice climbing about and also getting on to the bed. We are sharing a bathroom with another four, also a kitchen which nobody takes a turn to keep it clean. I wonder if you can help me to get a house. The landlord does not permit kids here. I really do not know what to do. Is that the tenant who harasses his unsuspecting and unprotected landlord about whom the Tory Party laments so often?

These tenants often live in fear. They pay ludicrously high rents and are even afraid, until this legislation, to apply to the tribunal for a reduction. The reason for this is that for them even squalor and exploitation are preferable to no home at all. When they use the rights they possess they are harassed and victimised to an intolerable extent.

The Bill, necessary as it is, and proud as we are to introduce it, will not create paradise for furnished tenants. It will not transform often dank and squalid quarters into bijou residences. It will not rid them of oppressive conditions against pets and, too often, even against children. But it will help to redress the balance. It will, perhaps, give furnished tenants statutory rights and provide them with a chance of emancipation. It is up to us in the House to let these tenants know of their rights. It is up to us to assist them to exercise their rights.

Above all, it is up to the House, with all due speed, to which the hon. Member for Bodmin rightly referred, and I trust with the co-operation of both sides, to hasten the Bill to the statute book and so to give to many thousands who too often have to live their daily lives in gloom and despair the hope that Parliament really cares about them and their problems.

9.58 p.m.

Mr. Timothy Sainsbury (Hove)

I hope that any hon. Member who speaks on this subject speaks with due humility. One thing that has been recognised is that our housing situation is not satisfactory. I fear that Governments over the last century will have to take some of the blame, because of errors of commission and omission, for our present situation.

I suggest that we should approach this Bill by looking for the balance of expected gain against potential disadvantage. I fear that in that respect we shall find the Bill in its present form somewhat lacking in balance. If we can all approach the Committee stage with due humility, I hope that we shall be able so to amend the Bill as to put back the balance and avoid the risk that there will be a loss.

Mr. Emery

On a point of order, Mr. Speaker. I seek your guidance on a matter which is of some concern to the

Question accordingly agreed to.

House. We have had a very important Bill, in the middle—

Mr. Walter Harrison (Treasurer to Her Majesty's Household)

rose in his place and claimed to move, That the Question be now put.

Question put, That the Question be now put:—

The House divided: Ayes 155, Noes 6.

Division No. 68.]	AYES	[10.00 p.m.
Allaun, Frank	Fowler, Gerry (The Wrekin)	O'Malley, Brian
Armstrong, Ernest	Fraser, John (Lambeth, Norwood)	Ovenden, John
Atkins, Ronald	Freeson, Reginald	Owen, Dr. David
Bagier, Gordon A. T.	George, Bruce	Palmer, Arthur
Barnett, Joel (Heywood & Royton)	Golding, John	Parker, John (Dagenham)
Bates, Alf	Grant, George (Morpeth)	Parry, Robert
Benn, Rt. Hn. Anthony Wedgwood	Grimond, Rt. Hn. J.	Pendry, Tom
Bennett, Andrew F. (Stockport, N.)	Hamilton, James (Bothwell)	Phipps, Dr. Colin
Bishop, E. S.	Hardy, Peter	Prescott, John
Blenkinsop, Arthur	Harrison, Walter (Wakefield)	Roberts, Albert (Normanton)
Boardman, H.	Hatton, Frank	Roderick, Caerwyn E.
Booth, Albert	Healey, Rt. Hn. Denis	Rodgers, George (Chorley)
Broughton, Sir Alfred	Heffer, Eric S.	Ross, Stephen (Isle of Wight)
Brown, Hugh D. (Glasgow, Provan)	Henderson, Douglas (Ab'rd'nsh re, E)	Ross, Rt. Hn. William (Kilmarnock)
Brown, Ronald (H'kney, S.&Sh'ditch)	Horam, John	Rowlands, Edward
Buchan, Norman	Hughes, Rt. Hn. Cledwyn (Anglesey)	Shore, Rt. Hn. Peter(S'pney&P'plar)
Buchanan, Richard (G'gow, Springb'rn)	Hughes, Mark (Durham)	Short, Rt. Hn. E. (N'ctle-u-Tyne)
Campbell, Ian	Hughes, Robert (Aberdeen, North)	Silverman, Julius
Carmichael, Neil	Hughes, Roy (Newport)	Skinner, Dennis
Carter-Jones, Lewis	Hunter, Adam	Small, William
Clemitson, Ivor	Irvine, Rt. Hn. Sir A. (L'p'I, EdgeHI)	Smith, John (Lanarkshire, N.)
Cohen, Stanley	Irving, Rt. Hn. Sydney (Dartford)	Snape, Peter
Concannon, J. D.	Jackson, Colin	Spearing, Nigel
Cook, Robert F. (Edinburgh, C.)	John, Brynmor	Spriggs, Leslie
Craigen, J. M. (G'gow, Maryhill)	Johnson, Walter (Derby, S.)	Stallard, A. W.
Crawshaw, Richard	Jones, Barry (Flint, E.)	Stewart, Rt. Hn. M. (H'sth, Fulh'm)
Crosland, Rt. Hn. Anthony	Jones, Dan (Burnley)	Stoddart, David (Swindon)
Cryer, G. R.	Jones, Alec (Rhondda)	Stott, Roger
Cunningham, G.(Isl'ngt'n, S & F'sb'ry)	Judd, Frank	Strang, Gavin
Dalyell, Tam	Kaufman, Gerald	Thorne, Stan (Preston, S.)
Davidson, Arthur	Kilroy-Silk, Robert	Tierney, Sydney
Davis, Clinton (Hackney, C.)	Lamborn, Harry	Tinn, James
Deakins, Eric	Lamond, James	Tyler, Paul
de Freitas, Rt. Hn. Sir Geoffrey	Leadbitter, Ted	Varley, Rt. Hn. Eric G.
Dell, Rt. Hn. Edmund	Lee, John	Wainwright, Edwin (Dearne Valley)
Dempsey, James	Lewis, Ron (Carlisle)	Walker, Terry (Kingswood)
Dormand, J. D.	Lomas, Kenneth	Watkins, David
Douglas-Mann, Bruce	MacFarquhar, Roderick	Watt, Hamish
Dunnett, Jack	McGuire, Michael	White, James
Dunwoody, Mrs. Gwyneth	Mackenzie, Gregor	Whitlock, William
Edelman, Maurice	McMillan, Tom (Glasgow, C.)	Wigley, Dafydd (Caernarvon)
Edge, Geoff	McNamara, Kevin	Williams, Alan (Swansea, W.)
Ellis, John (Brigg & Scunthorpe)	Marks, Kenneth	Wilson, Alexander (Hamilton)
Ellis, Tom (Wrexham)	Marquand, David	Wilson, Gordon (Dundee, E.)
Evans, Fred (Caerphilly)	Mason, Rt. Hn. Roy	Wise, Mrs. Audrey
Evans, Ioan (Aberdare)	Meacher, Michael	Woodall, Alec
Evans, John (Newton)	Millan, Bruce	Woof, Robert
Fernyhough, Rt. Hn. E.	Moonman, Eric	Young, David (Bolton, E.)
Fitt, Gerard (Belfast, W.)	Morris, Charles R. (Openshaw)
Flannery, Martin	Mulley, Rt. Hn. Frederick
Fletcher, Ted (Darlington)	Newens, Stanley (Harlow)	TELLERS FOR THE AYES:
Ford, Ben	Oakes, Gordon	Mr. Joseph Harper and
Forrester, John	Ogden, Eric	Mr. Jamer A. Dunn.

NOES
Bell, Ronald	Maxwell-Hyslop, R. J	TELLERS FOR THE NOES:
Emery, Peter	Morgan-Giles, Rear-Adm	Mr. John Cordle and
James, David	Winterton, Nicholas	Mr. Rees-Davies.

Question, That the Bill be now read a Second time, put accordingly and agreed to.

Bill read a Second time.

Bill committed to a Standing Committee pursuant to Standing Order No. 40 (Committal of Bills).

c1090
1. BUSINESS OF THE HOUSE 30 words
cc1091-106
2. MERCHANT SHIPPING BILL [Lords] 5,583 words
3. WAYS AND MEANS
c1106
1. MERCHANT SHIPPING 131 words
c1106
2. ADJOURNMENT 12 words