§ 4.25 p.m.
§ Mr. Ian Lloyd (Havant and Waterloo)
I am obliged to the House for the opportunity to raise this subject which apparently concerns two advertisements published in the Portsmouth Evening News and, in addition, in a large number of other newspapers and paid for from public funds. The reality concerns a much wider area of what could be a social disaster which follows the widening of the application of a great deal of housing and rent control legislation to the point where it is now beginning seriously to interfere with the rights of free people to negotiate and observe a contract for the occupation of accommodation belonging to one and rented by the other.
It was, therefore, with some astonishment that yesterday I listened to the speech of the Under-Secretary of State for the Environment in the debate on housing. In preparing for this debate I asked the Library to prepare what is a most interesting brief on the existing state of the law relating to landlord and tenants in the OECD area. This covers the whole range of housing and accommodation. Inevitably, the contrast between what the Under-Secretary was saying last night and the reality as it emerges in this brief was vivid.
There were four relevant conclusions which I drew from the brief. The first was that there was a close correlation between interference by the State in this sector and the collapse of the private accommodation market in the private sector. Second, it was clear that there is now obviously throughout the OECD area a persistent attempt to escape from the controls which have been, and are 1871 being, applied by Governments throughout the area. There is a general attempt to diminish the effect of these controls.
The third conclusion I drew was that, if one looks at the situation in all the countries, only in Italy is the situation worse than it is in the United Kingdom. Finally, and perhaps most interesting of all, if one asks oneself where it appears that this world-wide housing problem has been most satisfactorily solved, and nowhere is there perfection, two countries emerge—the United States and Sweden. The interesting thing is that in those two countries alone landlord-tenant relationships have not been narrowly circumscribed. Especially in the United States, the level of rent and the length of tenancy are two areas with which the law does not interfere.
The situation facing us now is best described by a simile. I call it "the falling-off-of-a-bicycle fallacy." Millions of people ride bicycles. Few fall off, fewer are pushed off, and even fewer are hurt in the process. But if under our system someone concludes that there is a great deal of political mileage to be gained from the fact that people fall off bicycles, and such an organisation or political party concentrates the whole of its political philosophy and propaganda on falling off bicycles, seeks to engage the human emotion of blame, to legislate, define categories of people who fall off bicycles and categories of circumstances which causes them to fall off bicycles, seeks by research and other means to find what these cause are and ultimately to interfere with the design of bicycles by legislation, to license users and to license circumstances in which people may ride bicycles, we have an interesting end result in that millions become conscious of the danger of riding bicycles. In the end confidence is diminished, the demand to ride bicycles falls and the industry collapses.
Then, if you will forgive the phrase, Mr. Deputy Speaker, some damned politician will say "The free market has failed the bicycle community". That is then put forward as the excuse for total control of the bicycle sector.
United Kingdom rent legislation seems an outstanding example of the bicycle fallacy. We are now as a nation entirely 1872 concentrating our minds on the worts and we have become almost oblivious of the face. The free market in housing has been suffocated. The free market in accommodation has been virtually strangled. This situation has been presented to the country as a triumph of social conscience over private gain. What a travesty of the truth that is.
My purpose is to concentrate on a particular category of owner-occupier—namely, the Service man. In 1951 this House passed the Reserve and Auxiliary Forces (Protection of Civil Interests) Act, in which it attempted to define a special form of protection for Service men. It recognised, and rightly so, that the civil rights of Service men were likely to be seriously prejudiced by the very nature of their occupation. The Act offered special security of tenure for the Service man who was the tenant of a home before he was posted away. It is interesting and relevant to my case that the 1951 Act made no mention of the Service man who was an owner-occupier. Why was that so?
I believe that the answer is straightforward. Such an owner-occupier Service man was assumed to enjoy a fairly substantial degree of security of occupation merely from the fact that he was the owner-occupier. That is no longer the position.
It is a long time since the House passed the 1951 Act. In 1975 I was advised by the Ministry of Defence—I quote the letter that was written to me by the Minister concerned—that the Service manhad an absolute right to regain possession when he needs the house again for his own occupation …".That is subject to the appropriate notices. The exercise of such a right requires a court order.
The Service man as an owner-occupier in those circumstances is in no different position from any other owner-occupier. Under the general gambit and range of the Rent Acts the conclusion that I come to is that owner-occupiers' rights have steadily diminished through the years. Included are Service men who are owner-occupiers. Their position is now different from that of the Service man who is a tenant. It is substantially less secure than that new totem pole of social policy—namely, Chief Sitting Tenant.
1873 The Rent Act 1968 and many of our other Rent Acts place great emphasis on the term "lawful residence". There are three classes of lawful residence. The first is those who own and occupy their own homes, the second class is those who rent or lease a home, and the third is those who occupy various new categories of statutorily enforceable occupancy under the Rent Acts. This marks the point of collapse in the property rights structure by placing it under a growing weight of what I can only describe of neo-Marxist legislation. It is presented to the country under the misleading euphemism of "social ownership".
I refer to the specific case of one of my constituents to whom I shall refer, as I have no wish to embarrass him in any way, as Lieutenant X. My constituent wrote to me as follows:I am a serving officer in the Royal Navy and have been married for five years. For the first 2½ years of marriage my wife and I lived in Service Married Quarters, saving every penny and slowly buying furniture in anticipation of having our own house. At last we had enough money and we just managed the down payment for our house. Ten days after we moved in I joined a ship and in 18 months spent only three months in the house. I was then appointed in January 1974 to a military establishment in Wiltshire for a one year course. At this stage my wife and I had spent two-thirds of our married life apart and we relished the prospect of a year together; but to afford the mortgage for the house and rent for the quarters we had to rent our home privately.At the end of the course I was appointed to a shore station and at last my family and I had the chance to live for some time in our own house. However, we reckoned without our tenant, a parasite of the welfare state, who refused to move and tried to invoke the Rent Act 1974.I am now advised by my solicitor that it will take approximately two months for the case to come to court with a further 28 days granted to the tenant to obtain council accommodation.It is, surely, manifestly unfair that I should not be allowed to live in my own house and that legal processes should cause further delay to the whole re-acquisition cycle. Ideally the Havant and Waterlooville Urban District Council could assist by anticipating the court's eviction order and rehousing my tenant at once. However, if you could intervene, anywhere, to reduce the waiting time before we can again live in our own house I and all my family would be most grateful.I endeavour to intervene, and the reply which I received from the local authority is also relevant. It reads as follows:The occupant of … house has been on this housing waiting list for just over one year. 1874 As you may know there are at present more than 1,250 applicants on this list, and with very few vacancies occurring offers of tenancies can only be made to those who have absolutely no alternative accommodation. The tenant has refused alternative accommodation offered by the estate agent who maintains the house in … absence and I feel it would not be policy to offer a tenancy in this case, since it would be to the detriment of other applicants.The tenant seems to be under the impression that if a court order is obtained against him he will be offered a council tenancy. However, this is not the case since the tenant will have created the situation leading to his eviction unnecessarily.That summarises the situation between Lieutenant X and the local authority.
The general problem was raised with me by a solicitor who handles many such cases in my constituency and another constituent, Mrs. Warrell. The solicitor drew my attention to an advertisement which has been published on 46 occasions in 75 daily newspapers in the United Kingdom and on eight occasions in 50 weekly papers at a total cost to public funds of £20,200. The Department of the Environment's comment on that is something which should be public knowledge.
In a letter to me in reply to a letter from the solicitor, the Department of the Environment said:the limitation of the Case to right of possession by the lessor who needs the house to live in again himself reflects a basic principle of the Rent Acts. Rent legislation throughout its history has treated the dwelling as a home, and not as an item of monetary value. The breaching of this principle could be considered only if there were evidence that failure to do so was causing serious personal difficulties irremediable by other means.I pause only to comment on the extraordinary effrontery of that statement. The rateable value of all domestic rated properties in England and Wales is £3,200 million. The Government's philosophy is that this is of no monetary value. According to the figures for 1972–73, one-third of the total capital value of estates, £850 million, was represented by houses.
The Department concluded:Any owner-occupier who has an automatic right of recovery can apply for an expedited procedure in the courts.I emphasise this:The time and effort this might cause must be weighed against the need to ensure that tenants are aware of the protection that the Rent Act 1974 affords them.1875 That is a fundamental point, it is an assumption that the owner-occupier in this situation, to serve this diffused criterion which is described as social justice, must suffer the cost, the inconvenience, the misery and the publicity caused by a tenant who observes the terms of this advertisement:Furnished tenants faced with eviction? Don't move.Furnished tenants your home is now protected.If your landlord lives elsewhere an order isn't likely to be made.The difficulty is that most Service men live elsewhere, as do most diplomats who are appointed abroad and engineers who go abroad and have to rent their homes. The House no doubt can imagine many other cases.
This is the point I put to the Government. If there is a choice between two identical families—and in today's circumstances many families are identical—occupying but not owning in the first case and owning but not occupying in the second case, by what strange logic should the latter bear the misery of homelessness, costs and all that is involved as a result of legislation especially when the nature of the employment compels the situation and particularly when it concerns public service in the Armed Forces?
I refer finally to a letter published in The Times by a Mrs. Jackson, who is in exactly the same situation. She wrote:The thought of constantly buying and selling houses every two or three years to avoid the exhausting and costly possibility of dragging tenants through the courts is too ridiculous as a way of life. Approximately 51 per cent. of service people own or are in the proces of buying their own homes, and the numbers are increasing. Buying one's home is now essential during service life to ensure a home when one retires. Will the Treasury reimburse all costs involved when service people have to take tenants to court?I have the answer for Mrs. Jackson: they will not, as I was told in a recent Parliamentary Answer.Also will they waive the Capital Gains Tax involved if they cannot move back into their homes and wish to sell, i.e., when posted to another part of the country? I doubt it.I doubt it, too—and indeed I know that the Treasury will not waive that tax. 1876The Rent Act has brought shabby treatment on those who serve their country willingly and well.She concludes:… if we wish to hold our homes without fear we must leave the public service that requires us to move arbitrarily.I have not much more to say, but I emphasise that Mrs. Jackson and others of my constituents have made a formidable case. The Government know, as set out in the letter from the Department, that there areserious personal difficulties which cannot be remedied by other means.The whole business has gone too far. Some solid reassurance is required—and that reassurance will not be sufficient unless the Under-Secretary of State can give an indication that something will be done about the matter. Otherwise, the nation will conclude that the Government are not interested in a sensible balance between the rights of tenants and the rights of owner-occupiers, particularly as applying to those who, in some strange and possibly political way, have been swept in under the umbrella of a Rachman-type landlord. This is a travesty of the truth. The legislation that flows from this assumption is proving to be a hollow sham in social terms. The nation will not be satisfied if the Government seek to redress the situation only by acting like a squid by the use of legislative black ink, which achieves nothing.
I wonder whether the key is to be found in the 1973 Protection from Harassment and Illegal Eviction Bill to which the hon. Gentleman the Under-Secretary of State for the Environment, who replied to the housing debate yesterday, appended his name. That Bill in defining "harassment" suggested that the house of the owner accused of harassment should be declared forfeitif the person so convicted were the owner of the said property or if the owner were unable to satisfy the court that the person evicted was not acting at his instigation or on his behalf.The crunch in that legislation was that the freehold of any premises forfeit under the subsectionwould for a period of 30 days beginning with the date of conviction be transferred to and vested in the local housing authority for the district in which the premises were situated.1877 That involved a total and complete confiscation; there is no other word for it. That did not become law but it is an indication of what was in the mind of the Under-Secretary of State.
I can only say, in conclusion, that if that or anything remotely approaching it is put forward by the Government as a serious legislative policy, it will not be merely a question of people such as myself raising the matter in an Adjournment debate, or even in the more formidable debates that we have in this House. People may be willing to put up with the elimination of private beds in hospitals, but in my view they will not be prepared to put up much longer with what is virtually the elimination of private rights in property. That is what the Government are driving at today. If the Government persist in that, they will not have a legislative battle on their hands: they will have civil war.
§ 4.46 p.m.
§ The Under-Secretary of State for the Environment (Mr. Gordon Oakes)
At the beginning of his speech the hon. Member for Havant and Waterloo (Mr. Ian Lloyd) referred to bicycles, which led me to wonder, since the responsibilities of my Department cover so many areas, whether I had strayed into the wrong sector.
The hon. Gentleman made a general point at the beginning of his speech about the relationship between legislative control and the supply of accommodation, and he may be interested in the figures.
During the last 20 years the decline of the rented sector has continued irrespective of whether rent control was in force. It is of even greater interest that the rate of decline was faster during the years following the Conservative Rent Act 1957, which removed the majority of controls, than it was before. Therefore, the hon. Member's analogy, in looking at the figures of other OECD countries and of the figures of this country, proves that there is a decline in the rented sector regardless of whether there is control.
The main substance of this debate concerns the advertisements which appeared in the Portsmouth Evening News of 18th November 1974. They formed part of an advertising campaign sponsored jointly by my Department and by the Welsh Office.
1878 First, the hon. Gentleman makes unnecessarily heavy weather of what is a long-standing point of law. He may not be aware that at any time since 1965 the landlord of furnished accommodation, like the landlord of unfurnished accommodation, would on the ending of a tenancy have to obtain an order for possession from the county court if the tenant did not move out of his own free will. That has been the law for 10 years.
Under the Rent Act 1965 it is illegal to evict a tenant without a court order, and if a tenant refuses to move without such an order he is merely exercising the rights that Parliament has given him. Since those rights have been on the statute book since 1965, and the last Conservative Government, to their credit, did not see fit to change the law, I assume that there is all-party endorsement of this basic human right to be protected from eviction unsanctioned by a court of law.
The hon. Gentleman concentrated on the Department's advertising campaign. He has claimed that, as a direct result of that campaign, his constituents have been put to unnecessary expense and trouble. I do not accept that. He has claimed that the advertisements in the Portsmouth Evening News give a misleading impression of the law. I think that they were very good advertisements.
When the Rent Act became law last summer it was of prime importance to make its provisions known to those tenants who were already under threat of eviction. We started with a national Press and television campaign and followed this with a series of advertisements in the classified columns of the local Press to get the message across. I accept that in the space of a small advertisement it is impossible to put all the "ifs" and "buts" into the text or to spell out the detailed provisions of an Act of Parliament. Only the main message can be got across in the space available, and that is why these advertisements are, I consider, successful.
The message is clear. Most furnished tenants who are good tenants, and who do not live under the same roof as their landlords, have security of tenure, a security they have had for the past 10 years.
1879 The next part of the advertisement is just as important—the advice to consult the rent tribunal or the citizens' advice bureau if notice to quit has been served. The rent tribunal and the citizens' advice bureau can deal with individual cases and advise tenants, as well as landlords, whether they are affected by the law. However, in a publicity campaign the Department can deal only with generalities. It is therefore necessary to direct people to the advisory bodies in their own area which can quickly provide detailed information on different aspects of the law.
The hon. Gentleman will remember that because of strikes the Act was not printed until several weeks after it became law. Some people did not know their rights or their responsibilities, and the people with most to lose through ignorance normally were the tenants. That is why the Press campaign was directed at them.
The hon. Gentleman represents a city with many Service men constituents, and he rightly drew attention to the effect of the law on Service men. Of course the Government are concerned to ensure that landlords also know their rights, and we have taken special steps to see that those serving away from home know what to do to ensure that they can return to their former homes. As the hon. Gentleman is aware, the Ministry of Defence has issued circulars, as have other Government Departments which have staff serving away from home, and efforts have been made to ensure that people working abroad independently or for commercial firms have the best chance of finding out their position under the new law. But, as I have said, the tenants who were at risk needed the most urgent advice.
The hon. Gentleman asked about the legal costs which landlords face if they take tenants to court. It is for the court to decide whether to make an order for costs, and I would not like to say what a court might do in any case. But landlords of furnished accommodation had to face the possibility that legal action would be necessary to repossess their property long before the 1974 Act came into force. It is, and has been for many years, a hazard of life for landlords. I do not believe the argument that before the 1974 Act 1880 tenants did not exercise their rights. The figures for the number of evictions demonstrate clearly that many landlords took furnished tenants to court. That was what the Act was designed to prevent, for good tenants of non-resident landlords letting dwellings not their own homes, and now does prevent.
I know that the hon. Gentleman is concerned about the case of the landlord who genuinely wants his own home back to live in, but in framing legislation we have to bear in mind the many other circumstances in which a landlord might wish to evict a tenant, and cater for the general situation. The Act makes it possible for the owner-occupier to recover his home, if necessary by action in the courts. It is unfortunately true that such action may involve expenditure, but it is open to the landlord who has been forced to this by the tenant's refusal to move to ask for costs, which the court has power to grant if it feels that the action of the tenant was unreasonable.
§ Mr. Ian Lloyd
Take the case of a tenant who observes the injunctions in the advertisement, stays put and is taken to court by the landlord. If the court asks the tenant why he stayed put and the tenant replies that the Department of the Environment told him to stay put, is the court likely to award costs against him?
§ Mr. Oakes
One can never say what a court might do in any case. But let us take the case of Lieutenant X. Supposing that his tenant read the advertisement. From it he would discover his legal position. However, the advertisement goes on to tell him to consult his local citizens' advice bureau. Presumably the advice given there would be that Lieutenant X was entitled to his home under the Act, and the tenant would be warned that if he went to court he ran the risk of costs being awarded against him if the court decided that his action had been unreasonable. The advertisement tells him to stay put and not to panic. It also tells him to seek proper legal advice in the cheapest way so as to acquaint himself of his rights and of his landlord's rights.
The hon. Gentleman suggested that Service people who are obliged to take court action to recover their homes should 1881 be entitled to reimbursement of the costs entailed. But, as I have shown, Service lessors are in no different position from any other people letting their homes, who in turn are in this respect in no different position from that of owner-occupier landlords before the 1974 Rent Act was passed. That is the essential point. This has been the law of the land for some 10 years now.
Finally, the hon. Gentleman talked about the balance. We are concerned to ensure that there is a balance of rights and that both the tenant and the landlord 1882 get fair play. In the past, all too often the tenant did not know his rights. He did not know what he could do. He was panicked into leaving the house that he occupied, not knowing that he had a right of action in the courts—
§ The Question having been proposed after Four o'clock, and the debate having continued for half an hour, Mr. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
§ Adjourned at five minutes to Five o'clock.