COMPENSATION FOR WORKING FARMERS (Hansard, 13 October 1975)

§ Mr. Benyon
I beg to move, That the clause be read a Second time.
This clause deals with compensation for working farmers. Throughout the discussions which have taken place during many years on the whole subject of compensation, including the Act passed by the last Government, the agricultural community has been pressing for equivalent reinstatement value to be paid when land is compulsorily purchased. In this 958 clause we are talking essentially of the time after the second appointed day. This may be many years ahead, and many of us hope that it will not arise, but in considering this Bill we must deal with the possibility.
In the existing situation of compensation, as hon. Members know when land is compulsorily purchased market value is paid, and this allows, in most cases, for at least equivalent reinstatement to take place. But more recently competition for the available land has increased. It is now very considerable and will increase still further after the Bill becomes law.
The basis set out in the new clause, on the other hand, would allow valuers to deal with each case on its merits and come to an agreement with the person whose land was being compulsorily purchased. There are good examples to be found in existing legislation elsewhere, in Holland and France in particular, which show how compensation can be dealt with in that way, and it is noteworthy that those countries have far less difficulty in the compulsory acquisition of land for use for community purposes—for roads, hospitals, or whatever it may be.
It is certainly my experience in local government—the same must be true of other hon. Members—that it is the penny-pinching attitude in relation to depriving someone of his livelihood that causes so much trouble. Let us be clear that we are talking of a man's livelihood. The situation is precisely the same as that which arises on the purchase of a shop or business. The land gives the farmer his livelihood, and when it is compulsorily purchased without his receiving reinstatement value his livelihood is at an end. Time and again, in my experience, this 959 has caused protracted negotiation, difficulty and frustration for both local government and the farming community.
It is not for me to smooth the Minister's path in the future, but, as we said so often in Committee, if only a more relaxed attitude could be taken on this question, both he and local government would be saved endless difficulty. I propose the new clause with no great hope of success, appreciating the nature of the advice which the Minister is receiving from his civil servants. I believe the purpose of the clause to be right, however, and, for the sake of the future, I urge that sympathetic consideration be given to it by the Government.

§ Mr. Walter Clegg (North Fylde)
I support my hon. Friend the Member for Buckingham (Mr. Benyon) in this new clause. What is in the mind of the National Farmers' Union is that after the second appointed day land at the periphery of towns which would normally be development land will, in effect, have a lower market value than land well away from development, so that someone who is compensated purely in market terms because his land is at the edge of a town will, if he has to reinstate himself, find himself paying a higher price for a farm well away from developed areas and not likely to be developed or redeveloped. Thus, the situation will be completely the reverse of what happens now.
We are talking about a state of affairs which is still a long way off, but the point must be made in this debate.

§ Mr. John Silkin
As the hon. Member for Buckingham (Mr. Benyon) feared, and as I fear, too, I cannot support him on this occasion. In the first place, although, as the hon. Gentleman knows, I never make technical points, I must say that I am somewhat puzzled by the technical defect of this new clause. It refers to the working farmer. I assume that the hon. Gentleman refers there to the tenant or owner-occupier farmer rather than the agricultural landlord, but he defines the term "working farmer" by saying in subsection (5): For the purposes of this section, 'working farmer' shall have the meaning assigned to it by Schedule 8 to the Finance Act 1975. 960 The trouble is that neither Schedule 8 nor any other provision of that Act defines "working farmer", so that we are starting somewhat on the wrong foot anyway. However, I think that I know what the hon. Gentleman means, and from his nod of agreement I see that I have it right, so I shall at once come to the more serious basis on which I must reject the new clause.
In any event, I do not regard this Bill as the appropriate vehicle for remedying defects, or alleged defects, in the compensation code. If those defects, or alleged defects, arise in the Land Compensation Act 1973, if the hon. Gentleman wishes to do so he can pursue them along those lines. No doubt they could be dealt with on that basis, but I do not think that that matter has relevance here.

§ Mr. Benyon
It is relevant because the Minister is himself altering the basis of compensation. Since he is doing that, it is surely valid to deal with the basis of compensation along these lines.

§ Mr. Silkin
I was just coming to that. Let us take the Clause 27 situation which, if one cares to put it so, changes the compensation code to current use value. What we are eliminating from agricultural land on that basis is the development value; the land retains its agricultural value, and as at that stage of the scheme all agricultural land will be on current use value, regardless of whether it is sold privately or to an authority, it seems to me that the position of a displaced farmer who wishes to reinstate himself elsewhere will be no different from what it is at present, save that everything will be done on a CUV basis.
Again, if the hon. Gentleman's proposals were written into the Bill, the additional benefits which his new clause would import would be quite unacceptable because—I put this quite frankly with reference to the working farmer as both the hon. Gentleman and I understand him; we both like him and want to help him—the working fanner would be made better off than any other category of person, and better off, indeed, than he would have been if his land had never been acquired, for it is unlikely that he would derive as much benefit as this from a private sale.
961 Let us take some examples. Subsection (3) read with subsection (2) appears to provide for compensation on a reinstatement basis to apply so that a working farmer would have reimbursed all his expenditure on reinstating himself elsewhere. Thus, one might have a tenant farmer getting the freehold cost of a replacement farm if he could not find a leasehold one.
In the first place, therefore, there would be a special provision for farmers which other members of the community would not have. Secondly, it would be a rather illogical basis, whereby the working farmer would be better off as a result of having his land acquired than he would be if it were not. Thirdly, as in the case I have suggested, a tenant farmer might get a freehold farm out of it.
It ought to be accepted that the Government have gone a long way in their assistance to farmers. Not only have we gone a long way to safeguard agricultural land; the situation will in fact be better, because there will not be the development of land at the expense of good agricultural land in the haphazard or frequent way which we have seen hitherto. The whole basis of land acquisition will then be planned.
Moreover, from the point of view of the working farmer, the man whom the hon. Member for Buckingham and his hon. Friend the Member for North Fylde (Mr. Clegg) want to protect, as I do also, it should be remembered that at the moment when the current use value world is entered under Clause 27, we shall be setting up the financial hardship tribunals. It is, I think, to those that the working farmer should go if he feels that he needs more than the current use value, if he is losing agricultural land and having to buy other land and feels that something special should apply.
On that basis, I hope that the hon. Gentleman will agree to withdraw his new clause.

§ Mr. Benyon
In regard to the expression "working farmer" the provisions of the Finance Act provide for certain concessions, but I am still not satisfied with the Minister's explanation. Whereas a business, including goodwill, is compensated in full, this is not the case in regard to some Acts of Parliament. In 962 regard to the hardship tribunals the provision is not definite. We do not know exactly how it will operate. However, I am prepared to withdraw the motion because I am certain that the matter will be taken further in another place. I beg to ask leave to withdraw the motion.