§ Motion made, and Question proposed,
§ That this House takes note of the Government's intention to make fresh provision with regard to agricultural tenancies.
§ 4.8 p.m.
§ The Secretary of State for Wales (Mr. John Morris)
When the Opposition expressed a strong desire 10 days or so ago that we should spend a few hours discussing the question of family succession to agricultural tenancies they set the House a greater procedural conundrum than at the time they probably realised. The formal situation is, I think, generally known. Last November the Government presented a quite short and modest but useful Agricultural (Miscellaneous Provisions) Bill, to which the House gave an unopposed Second Reading on 1st December last.
The Bill did not contain any provision for family succession to farm tenancies, and this fact was commented on—in some cases unfavourably and in some more favourably—by a number of hon. Members—on my count about a dozen—who intervened in the debate. Among points to which reference was made was, of course, the fact that a legal right to family succession has existed in Scotland for a number of years. Following the Second Reading, the Bill was committed, in accordance with our normal procedure, to a Standing Committee which has been considering it in detail since the middle of December.
Because the question of family succession gave rise to so much interest in the Second Reading debate, we naturally undertook to give it further consideration, and duly did so. The upshot was that, since it seemed clear that there was on merits a case for making legislative provision now in this matter and in view of the strength of the views which were evidently held on it in various quarters—not by any means confined to a single political party—we decided that it would be right to seek to secure the addition to the Bill of new clauses for this purpose, and my right hon. Friend informed the Committee of this intention on 3rd February, tabling the new clauses themselves on 25th February.
In pressing on behalf of the Opposition for a debate on the subject, some right 46 hon. and hon. Members used the rather absurd argument that, because the Bill as originally presented had not included these provisions, there had been no opportunity to consider them from the viewpoint of the issues of principle involved. I describe this argument as rather absurd because, as I have already mentioned, well over half the speakers on Second Reading, incidentally including the hon. Member for Westmorland (Mr. Jopling), gave the House at least some indication of their views on this subject, so that it was well ventilated.
However, we readily concede that there is a difference between discussing a topic as an abstract matter of policy or principle and debating it, as we are now doing, on the footing that it represents a firm and announced Government intention. Hence I welcome today's debate on an important question from the social, agricultural and other points of view, and it deserves careful consideration. I trust that our discussions today on the principles will assist the Committee when it comes soon to discuss the details.
My aim is to give some indication of the thinking which underlay the Government's decision to table the new clauses on family succession, to explain in quite general terms how we should expect to see these provisions operating in practice, and finally to explain why having decided against including provisions on this subject in the Bill as originally presented, my colleagues and I reached the view that it would after all be right to seek their inclusion in the course of the Committee stage. The House is entitled to expect that.
To start with the basic principles at issue, I doubt whether any Member of the House who has the slightest acquaintance with agricultural or rural life would disagree with me when I say that the relationship of a tenant farmer, and his family, with his farm and with his landlord is a peculiarly close one.
After all, to the farmer, his wife and his children, the farm is home, in the sense that it normally provides the house in which they live. It is the place where they spend most of their working and, indeed, leisure hours, too. At the same time, the farm represents the tenant's business, very probably over a period of many years, from which he draws his 47 own and his family's livelihood, into which he ploughs back, in the most literal sense, part of his profit as well as devoting to it the main share of his own, and often his family's, physical effort.
I do not think that this is an over-idealised picture—it is not so intended—and it follows from this relationship that if, on the death of the tenant, the farm is transferred into other hands, there can be a distinct element of hardship suffered by members of the dead man's family.
We all know that in a large proportion of cases no such hardship in practice arises. Landlords, because they have developed this particularly close relationship with tenants and their families, and perhaps because it is in their own best interest to secure new tenants who both know their farming and know the particular farm, will often agree without hesitation to let one of the dead tenant's sons or other close relatives succeed to a tenancy.
But although we know that this is a common occurrence, we equally know that things do not always work out so smoothly and that there are cases—perhaps only a minority—in which it is impossible to avoid a feeling that hardship has been created by the landlord's unwillingness to allow some member of the tenant's family to succeed to the tenancy. The views which I have heard in recent months—views which have come to me not only from right hon. and hon. Members, but also from major organisations such as the farmers' unions—have persuaded me that in principle some limited legal provision for family succession is desirable in the interests of fairness, equity, humanity—or however else one might like to describe it—and in the wider interests of agriculture and of food production.
I deliberately spoke of "some limited provision" for family succession, and I should explain what I mean by this phrase. By "limited" I have in mind several things. First, it seems to me that in social or human terms a claim to succeed to a tenancy, if the main purpose is to avoid possible hardship, is likely to have real strength only in the case of a near relative, such as a wife or husband, son or daughter, in which I would include adopted or step-son or 48 step-daughter or brother or sister. After all, we do not in normal daily life regard the kinship of a nephew or cousin on the same plane of proximity as that of the really close relatives that I have mentioned, and this seems to me to be a relevant distinction in the present context.
Secondly, I feel that a claim to succession has moral force only if the relative concerned has developed over a period of years a close knowledge, understanding and affinity with the land in question. To illustrate this point, consider a tenant farmer who has two sons. One of them stays with his parents, possibly going off at some point to gain wider experience with some other farmer or to take a course at an agricultural college, after which useful educational experience he comes back to work with his father at home. His brother meanwhile has emigrated to the other end of the world, where he has become a competent and, if he is lucky, a wealthy farmer. Surely we would all think that when the father dies it is the son who has stayed at home and worked on the farm rather than the other son who is all set to fly back from the Antipodes who has the stronger moral claim to succeed to the tenancy.
Thirdly, it would not be in anyone's interest—certainly not that of the landlord, nor in the national economic interest, which requires the most efficient production of food, nor even in the interest of the individual concerned—to provide for a right of succession to a tenancy by someone who had not by training and experience, by health and financial standing the ability to farm well and to make a satisfactory tenant. It is criteria of this sort—closeness of relationship, length of experience, and knowledge of the farm, and the possession of adequate training, health and financial standing—which I have in mind when I refer to the Government's acceptance in principle of the case for a "limited" scheme for family succession.
I come now to consider how, in the Government's view, the principle which I have described can best be given effect. Let me say at once that the fact that my right hon. Friend has tabled seven new clauses, which are intended to replace and to fulfil very much the same purpose as the single new clause originally tabled by my hon. Friends the Members for 49 Durham (Mr. Hughes) and Brecon and Radnor (Mr. Roderick), is in no sense intended to belittle his initiative or that of other hon. Members who supported him. I congratulate them. However, I am afraid that this is yet another illustration of the sad fact that, when one is legislating, things almost always turn out to be more complex than one had expected. My right hon. Friend is anxious that if we are to deal with this subject at all we should get it as nearly right as possible.
§ Mr. Paul Hawkins (Norfolk, Southwest)
Would it not have been far better, as was promised in 1968 when this matter was mentioned by the Minister of Agriculture's predecessor, had there been a major overhaul of the Agricultural Holdings Act? Would that not have been preferable to muddling with the Agricultural Holdings Act in a miscellaneous provisions Bill?
§ Mr. Morris
I shall deal with that matter in the latter part of my speech when I come to the general reforms of agricultural holdings. I hope that I shall carry the hon. Gentleman with me when I say in connection with the substance of what we are doing that we are not muddling and that this provision has been welcomed by a whole host of organisations although other organisations have rejected it. Certainly the National Farmers' Union has welcomed it as both fair and equitable.
§ Mr. Morris
It has certainly warmly supported the provision. I give the hon. Gentleman that assurance.
I cannot say, when one compares the seven clauses with the clause drafted by hon. Members, that it gave me any pleasure to find that so many clauses were required. But I want to reassure my hon. Friends that our objectives are very close together, as indeed, it appears are our views on method. I was reminded when reading the clause that they tabled that it was similar, if not word for word the same, as a clause tabled by Mr. Elystan Morgan in 1966 and I think also in 1968. Undoubtedly, he will be pleased with the 50 progress that is now being made in fulfilling his aims.
When we turned to consider the implementation of the principle which I have discussed, we quickly reached the view that my hon. Friends had been right in their new clause to propose the Agricultural Land Tribunal as the main instrument for decision-making in this field. Some Members have doubtless come into closer touch, like myself, than others with the activities of this Tribunal, or network of tribunals, as in reality it is.
But I think the House will agree that the Tribunal is a particularly well balanced body and much experienced in the type of case which involves the hearing of notice to quit cases. The chairman is an experienced barrister or solicitor appointed by my noble Friend the Lord Chancellor, and assisted by two lay members who represent the land owning and farming interests, and are drawn from lists of persons nominated by the Country Landowners Association and the National Farmers' Union respectively. Moreover, the Tribunal can call on the assistance of two assessors drawn from a panel of professional men nominated by the Royal Institution of Chartered Surveyors.
I think that it will be generally accepted—this certainly was my professional experience—that the Tribunal has earned a well-deserved reputation for fairness, impartiality, experience and common sense—qualities which are essential in deciding the sort of cases with which we are here concerned. I am sure that we have chosen the right instrument for this purpose.
Turning to the work which the Tribunal will be called upon to undertake, I foresee that there may in any particular case be two rather different types of question at issue, either or both of which may need decision. First, there may be a question, after the death of a tenant, whether a particular close relative, perhaps a son, who wishes to succeed to the tenancy is qualified, on the sort of criteria which I discussed a few minutes ago, to do so. This will involve consideration of the length of time during which the applicant has worked on the holding, an assessment of his agricultural competence, age, health, financial standing and so on; and any views on him expressed by the landlord will be relevant as well. There may 51 be just one relative who applies for consideration and meets these tests. But there may be two or even more who do so and it will then be the Tribunal's duty to form a judgment as to which of the qualified applicants has the strongest claim.
At the risk of a short digression I should like at this point to mention the question as to what weight it would be right to attach to any testamentary bequest expressed in the will of a deceased tenant. It seemed to us that it would be difficult to justify a scheme which provided a legal right to apply for the succession to a tenancy only in cases where this had been expressed as his wish in a will left by the deceased tenant.
On the other hand, it seemed to us that it would be equally wrong to go to the other extreme and to say that a testamentary bequest was of no relevance and should be disregarded. We concluded that it would be right to provide that an applicant, designated by the deceased in his will, should have an overriding claim as against any other applicants, provided of course that the Agricultural Land Tribunal were satisfied as to the other relevant matters. This seems to us to be a fair and workable arrangement.
I have concentrated so far on the first class of question which the Agricultural Land Tribunal may be asked to consider and decide—the qualification, against the criteria which I have outlined, of a close relative who applies for the succession to the tenancy or, if there should be more than one qualified applicant, the choice between them of the strongest candidate.
Another class of question will arise in a case where the landlord wishes to resist an application to succeed by a close relative of his deceased tenant, either because he wishes to relet the farm to some other tenant or because he wants to take it in hand and farm it himself or perhaps wants to sell it with vacant possession. Under the present law a landlord whose tenant dies can, if he so wishes, serve a notice to quit and regain possession of the holding at the end of the next full year of a tenancy. Such a notice cannot be contested.
The scheme which the Government are proposing would require the consent by the Agricultural Land Tribunal to the 52 operation of such a notice to quit but would lay down the considerations which the Tribunal must take into account. These would include a number of considerations which, in a slightly different context, feature in the existing law—for example, the interests of good husbandry, of sound estate management, agricultural training or research, the need of the land for some other use, or simply that greater hardship would be caused by withholding than by giving consent. And we are proposing to add a new consideration—that arising in the case where the holding is too small to be a commercial unit and the landlord proposes to amalgamate it quite soon with other land to form a commercial unit. Overriding all these considerations is the wide question of judgment whether in all the circumstances it appears to the Tribunal that a fair and reasonable landlord would not insist on possession.
I will not go further into the detail of our proposals. I would simply add as one last point that we had to consider whether the scheme which I have outlined should operate for an indefinite period of time or on some limited number of occasions. Here again we approached the problem by considering the extreme possibilities.
At the one extreme it would have been possible to place no limit on the number of successions which could take place under the scheme, so that in theory successions within a single tenant family could continue in perpetuity. This would deprive the landlord of any assurance that he would ever be able to regain possession of what, after all, is his own holding and his own buildings. We felt that such an arrangement would be likely to cause such serious damage to the landlord-tenant system and to prove so severe a disincentive to the letting of farms that in the interests of maintaining a healthy and efficient agricultural industry it would be imprudent to adopt this course.
At the other end of the scale, we felt that to limit the operation of the scheme which we had in mind to one single occasion would deprive it of much of its practical effectiveness, and would be unnecessarily restrictive.
We accordingly felt that, as an intermediate course, there would be advantage in following the precedent which we have in the case of dwellings in the Rent Acts, 53 by providing that the right to family succession may operate on not more than two successive occasions. This will meet the case where on the death of a tenant he is succeeded by a son, who in the fullness of time dies and is in turn succeeded by his own son, that is to say, by a grandson of the original tenant. That is by way of illustration.
I am advised that the up-to-date figure for the average length of a tenancy is somewhere between 30 and 40 years, so that a considerable degree of family continuity will be provided under our proposals. We do not think that it would be desirable, or is necessary on social grounds, to legislate for a longer period ahead than this.
I hope that from what I have said it will be clear that our intention and strong desire throughout the preparation of these proposals has been to devise a statutory scheme which will hold a fair, reasonable and just balance between the interests of the various parties concerned and which will best accord with the needs of agriculture. I am encouraged to think that I may have had some degree of success in this objective by the fact that the farming unions in England and in Wales, whose membership includes tenant farmers, owner-occupiers and landlords, have, to judge by their comments reported in the Press, found our proposals broadly acceptable and satisfactory.
The Country Landowners Association, which is primarily representative of private landlords, has, understandably, been more critical. But we have kept in close touch in recent weeks with its officers, and I take this opportunity to express our thanks for the unfailing courtesy and constructive spirit in which they have conveyed their views and comments to us. While I can understand their grounds for feeling that at a time when some private landowners may have particular reasons for wanting to take farms in hand or to sell them with vacant possession, our proposals may create difficulties for such landlords, I believe that their fears will prove to be exaggerated.
Under the scheme which we are proposing, the landlord will have every opportunity, if he wishes, to develop his case before the Agricultural Land Tribunal, and, as I have already said, I believe that the Tribunal is a body in which all parties concerned can place 54 confidence. That was certainly my experience at the time when I used to appear in a professional capacity before the tribunal.
I do not believe that this legislation will mean that never again will any privately owned farms be let, or that it will be detrimental to agricultural production. On the contrary, I believe that the feeling of greater security for his family will encourage the tenant farmer to farm even better than he does today, and will encourage his sons to develop their skills, and that, on balance, this will strengthen British agriculture, not weaken it.
§ Sir Paul Bryan (Howden)
If that be so, and if it be such a great advantage to farming that the tenant farmer should be in that position, why is the State as landlord not coming into the scheme?
§ Mr. Morris
Wherever the Minister is responsible for land, he will certainly carry out the spirit of the legislation. If the hon. Gentleman is referring to local government holdings—
§ Mr. Morris
The hon. Gentleman used the word "State", and that is why I was about to raise the question. My hon. Friend the Under-Secretary of State will deal with that question in reply. I do not wish to take unduly long at this stage. Hon. Members may ask why should not all government come into the scheme. Hon. Members know that local authorities are democratically elected, and they seek to ensure that they fulfil their obligations in the full gaze of the public eye. Moreover, there are certain regulations, of which hon. Members may not have heard, which deal with their responsibilities in these matters. My hon. Friend will, as I say, deal with the matter at greater length. I now understand that the hon. Member for Howden (Sir P. Bryan) was referring not to State holdings but to local authority holdings.
§ Mr. Alan Clark (Plymouth, Sutton)
Why does the right hon. and learned Gentleman shrink from admitting that the real distinction is the prejudice against private property which he and his right hon. and hon. Friends hold? They see a distinct difference in quality between farms which are privately owned and land which is held by the State. They choose 55 to penalise the one and to benefit the other.
§ Mr. Morris
I hope that the hon. Gentleman will take the opportunity to consult any friends he may have in the National Farmers' Union to discover their views on this matter and whether our proposals are in any way regarded by them as being a matter of pique or prejudice. In fact, they are regarded as fair, reasonable and equitable, and I hope that, after the hon. Gentleman has consulted his friends and come back to the Committee, he will consider these matters in detail in a different light. I trust that he will take up my invitation to ascertain what his friends in the NFU believe.
I wish to say a brief word about a line of comment which has reached me from various quarters, to which reference was made my the hon. Member for Norfolk, South-West (Mr. Hawkins) in his earlier intervention. I refer here to the suggestion that, whatever may be the merits or demerits of the principle of family succession, this miscellaneous provisions Bill is not an appropriate measure in which to deal with the subject.
I have to admit—indeed, it is obvious—that we did not originally intend that family succession should be dealt with in the Bill. This reflected the fact that we are faced, as any Government tend to be nowadays, with a perennial struggle to accommodate within the limits of the parliamentary timetable all the legislation which we regard as desirable. It is not an easy task to balance the priorities of what should be in this kind of Bill and what not. Another consideration in our minds was that there are various respects in which the agricultural holdings legislation is ripe for review and amendment. The hon. Gentleman was right there, and I endorse his comment in that light.
There has already been a fair amount of discussion with interested agricultural and professional organisations. Some changes are generally agreed to be desirable. Others still require discussion and decision. If parliamentary time had been unlimited, we might have hoped in the current session to be able to bring forward an Agricultural Holdings (Amendment) Bill, and I accept that, if that has been so, this would probably have been the most natural and convenient measure 56 in which to tackle the question of family succession. But time is not unlimited, and this opportunity was not open to us.
I trust that the House will find it gratifying that the expression of keen interest in the matter which was voiced on Second Reading, combined with the public discussion which has taken place since 1st December last, has persuaded the Government that there is a substantial body of opinion which regards this subject as deserving a sufficiently high order of priority to be included in the Bill. This is what parliamentary democracy is all about, and we are happy to respond. We have taken action accordingly.
My right hon. Friend still hopes to find an opportunity in the not too distant future to deal with other questions in regard to agricultural holdings which deserve attention. But the fact that we are not able to do so now is not, in our view, an adequate reason for not taking action on family succession.
To sum up, therefore, I submit that the Government's proposals represent a workmanlike and equitable approach to a subject which is a matter of widespread interest, that they will help to eliminate cases where hardship might otherwise arise, that they will strengthen rather than weaken the landlord-tenant relationship, and will prove on balance beneficial to the efficient production of food in England and Wales.
I pray in aid the words in the recent statement by the National Farmers' Union:The National Farmers' Union has … endeavoured from the outset to devise a formula that would be fair and balanced … The NFU considers that the scheme embodied in new Clauses 7 to 13 does in fact strike that fair balance.
§ 4.40 p.m.
§ Mr. Francis Pym (Cambridgeshire)
I declare an interest as a landlord and as a tenant—in my latter capacity with lots of near relations.
I should like to thank the Leader of the House and the Patronage Secretary for providing time for this debate. I am certain that it is right to have it, but that does not mean, as I very well know from past experience, that time is ever readily or easily available. I should like to say at the outset that I hope the Minister of Agriculture, Fisheries and Food will 57 attend as much of this debate as he possibly can. I fully appreciate that he has other matters on his mind, and so have all of us, but it would be an advantage to us all if he were present, at any rate for part of this debate.
The way that the Government have handled this proposal for hereditary tenancies is a good example of how Parliament ought not to deal with legislation. The Government had no intention originally of legislating in this way in this Bill; otherwise the clauses would have been in the original Bill. There was no mention of this subject in the Minister's opening speech on Second Reading, except in answer to an intervention. Had the Government intended to legislate, they would have taken adequate and proper time to conduct all the usual and necessary consultations, and they would have done their homework thoroughly. But they did not.
I appreciate that recently, and hurriedly, they have been doing so, but they did not do it thoroughly at the outset. Faced with the Minister's decision not to legislate, the Parliamentary Secretary and other hon. Members opposite started chipping away underneath. The Back Benches were encouraged to table a new clause, which they were entitled to do—
§ Mr. Mark Hughes (Durham)
Will the right hon. Gentleman accept from me, as the person who tabled a clause, the unreserved comment that at no time did I receive from my hon. Friend the Parliamentary Secretary any encouragement to "chip away" or to put down such a clause behind closed doors or anywhere else? That statement must be withdrawn as being factually inaccurate. As the person who put down the clause, I ask the right hon. Gentleman to withdraw his statement.
§ Mr. Pym
It is extremely difficult to put that interpretation on the winding-up speech of the Parliamentary Secretary or on the words used by the Minister in answer to the intervention by his hon. Friend the Member for Bradford, South (Mr. Torney). At any rate, a nod and a wink—call it what you like—there was no absence—[HON. MEMBERS: "Oh."] There is nothing wrong with that. But I maintain that it is very 58 difficult to interpret the winding-up speech or the Minister's reply to an intervention except in the terms that I have stated. What happened was that the campaign, which was legitimate, intensified, and the right hon. Gentleman found himself in a position of having to legislate. The Government then started drafting proposals in earnest, only to find that they had been driven not into a simple scheme but into a position of requiring seven new clauses. What was believed to be a significant but comparatively slight change to the law on land tenure was found to be more complicated. Its implications are far-reaching and have not been given the thought and consideration that they certainly warrant.
Our position on the Opposition Benches has been and still is that a review of the working of the agricultural holdings legislation is necessary and, indeed, overdue. What the right hon. and learned Gentleman said in his opening speech indicated that he accepted that fact in principle. But I find his excuse about parliamentary time, and so forth, slightly lame. At any rate, if we are agreed about the need for it, that is something. Some of my hon. Friends will speak on the weakness or the failures, in practice, of the working of the 1948 Act. The law in this field needs to be looked at and thought of as a whole. Each part impinges on another part, and any adjustment of one part affects the structure of the whole.
These new clauses are a piecemeal approach—an ad hoc adjustment—which will not stand the test of time. Their ramifications, if left as drafted, will affect the whole of our land tenure system. Therefore, we on the Opposition Benches reserve our position absolutely on the agricultural holdings legislation. It is in need of a review now, and will be in even more need, anyway, after the Conservative Party comes to power at the next election. We reserve our position to make whatever changes seem to us appropriate, all in the interests of homegrown food production. At any rate, that objective is something that we share across the Floor.
We are dealing with one aspect—a profound one—of the landlord-tenant system. That system has been an indispensable element in the success of the industry. We tamper or tinker with it at our peril. In numerous cases, sons 59 have succeeded their fathers, in many instances for several generations, on the same farm—a marvellous tradition—and continuity has been built up. Equally, there have been, though alas not nearly to the same extent today, plenty of opportunities for new entrants to come into farming with all the fresh thinking, innovation and vitality that they bring.
§ Mr. Pym
Thousands. Whatever else can be said of these proposals, I cannot see how anyone can argue that a new entrant coming into farming can be in a position other than infinitely worse than before, and perhaps impossible. It is significant that the young farmers' organisation is against these changes. They see all too painfully clearly the limitation to be imposed on them and the reduction of their chances in finding farms to rent.
The Minister of Agriculture—I am sorry he is not here—maintained, as did the Secretary of State for Wales, that he believes in the landlord-tenant system. He said in Committee on 3rd February that the new clauses willstrengthen still further the landlord-tenant system of farming which plays so important a rôle in British agriculture."—[Official Report, Standing Committee C, 3rd February 1976; c. 421.]I wish I could think that he was right. The system is already under severe stress. Apart from the workings of the law on land tenure, there is the crippling burden of taxation on capital no less than on income, and I understand that there is more to come in the form of a wealth tax. The Labour Party Policy Committee document on nationalising the land, now endorsed by the Labour Party Executive Committee, assumes the introduction of such a tax. What was the Minister's comment on that? Nothing. He had nothing to say. How can the system continue if it is being bled of its resources? The State certainly has not got the resources, and the country is being taxed to death. Already there is an ugly distortion in the very system which the right hon. Gentleman says he supports so strongly. I hope he is sticking up for the farmers with the Chancellor of the Exchequer, with the same vigour and resolution as the industry itself.
60 It is fair for the right hon. Gentleman to claim that the official NFU line is also in support of these new clauses, and he quoted accurately from the Press statement, but I think the NFU is wrong. Many tenants and the families may be pleased in the immediate future, but the long-term effect is much more important. I will go this far with the Government on the principles involved in these new clauses: first, that some kind of preferential arrangement for the son of a tenant, provided that he is suitably qualified, capable and a fit person to take on the holding, might well be devised. For decades this has been the actual practice, voluntarily undertaken in a good many cases, and to the lasting benefit of all the families involved. It happens less today but that is because of the pressures of taxation. None the less, the sons of tenants are, as they have always been regarded as being, in a special position. New Clause 7, however, goes much wider than sons. It is not restricted to the deceased tenant's uncles, cousins and aunts; it extends to a lot of near relations.
Secondly, I would go this far with the right hon. Friend, that some procedure for assessing and judging cases of genuine hardship could also be devised and, I believe, would be appreciated. I say this despite the fact that it has been remarkable in the operation of the landlord-tenant system how few such cases of hardship there have been. I suspect that the truth is that in the overwhelming majority of cases the good old-fashioned common sense of the agricultural community has worked. Nevertheless, any and every case of hardship is most certainly a cause for concern, and a new procedure for considering them would be valuable and, in my view, appreciated.
This brings me to the first substantive matter on the new clauses. The Minister has referred in Committee and outside the House to "effective safeguards" for the landlord. I shall need to be convinced that these proposals provide them. In his opening speech the Secretary of State spoke at length of the qualifications that the deceased tenant's relative would need to have, but I heard very little about the landlord's side of things. Apart from the narrow addition in New Clause 11 to the grounds upon which a notice to quit may be upheld we are not 61 satisfied that the potential hardship of the landlord is adequately covered by reference back to Section 25(c) of the 1948 Act. Upon what basis is "greater hardship" to be adjudged?
§ Mr. John Morris
Is the right hon. Gentleman not aware that since 1948 the greater hardship provisions have generally been regarded as operating satisfactorily? Why should they not work in this context? Does the right hon. Gentleman want to add to or amend those cases which are adjudicated upon regularly?
§ Mr. Pym
We have talked of the tenant's son, but what about the landlord's son? The landlord's son might have been planning and training to farm a holding. He might or might not farm it well, like the tenant's son, or anyone else. How is his interest and /or his hardship to be assessed?
There is very little case law which is relevant here under the 1948 Act. Something positive needs to be put into this new package to clarify what is meant by hardship and to make it clear that hardship on both sides will be fully considered. What about the landlord's tax position for example? No tribunal has considered that. Will it be a valid claim, upheld by the tribunal, if a landlord can show that he needs to sell with vacant possession to meet the confiscatory demands of a Labour Government? Will the notice to quit stand?
It is possible that a landlord will have other assets but for a variety of reasons he may not wish to dispose of them and may wish to sell a holding with vacant possession. Would that be an overriding reason for a tribunal to find for the landlord?
The word "overriding" appears in the new clause in the context of a tenant's will but the landlord will want to have knowledge of what is envisaged in these circumstances. We must have answers to these questions The Minister's declared intention to protect the landlord's interests needs to be spelt out more specifically and positively in the Bill.
This leads me to my next strong reservation about agricultural land tribunals. They have served agriculture well, with public acceptance and without controversy. I endorse what the Secretary of State has said about them his afternoon.
62 But they are now to be charged with more onerous responsibilities which will be of a more social, personal and family nature. They are to be asked to judge between the relative hardships of families, each with its own aspirations and ambitions, qualities and qualifications, their own human and other problems. What a difficult judgment. I question whether the agricultural land tribunals, for all their excellence and integrity in respect of their existing statutory responsibilities, are designed to make such delicate human judgments.
There is also the question whether it is right for such delicate matters to be heard in the locality where the problem arises and, perhaps, by people who know the families involved. One could argue that that might be an advantage, but equally one could imagine that there could be some bitter and hard feelings. Are the hearings to be in public or in private? I think that such hearings have been in public up to now.
§ Mr. John Morris
I fail to follow the right hon. Gentleman. He must know that this kind of issue, in another context, is being adjudicated by these tribunals. They deal with the issue of greater hardship, particularly as it affects notices to quit, and they have gained general acceptance.
§ Mr. Pym
I have been trying to say that the decisions and judgments which will flow from these new clauses are of a different character and kind. I entirely endorse what the right hon. and learned Gentleman said about the tribunals in another context. In this case greater hardship will have to be judged in circumstances which have not existed before. Something totally new in scale, degree, character and kind is now being proposed, and that causes me anxiety.
Are the hearings to be in private? There wil be some very delicate issues involved. The circumstances surrounding the relation of the deceased tenant and the circumstances of the land will have to be weighed. That is a new kind of judgment. It seems quite clear that the Government have not considered these aspects of the problems deeply enough. They have not given themselves enough time. We are dealing here with the human aspects of families, and I do 63 not think that the matter has been considered in this light before. The Government have not given themselves enough time to consider this in detail. The House ought to hear more about it. The points that I have raised—the hardship of the landlord and the relative position of both sides in the argument—are totally different in degree from those matters currently considered by the tribunals.
The right hon. Gentleman will meet with strong opposition to his exemption of himself and local authorities with smallholdings from the provisions of the clauses. The whole proposition goes too far, anyway, but to create one law for all private landlords and their tenants, and another for himself as Minister of Agriculture and his own tenants, and smallholdings authorities as landlords and their tenants, is tantamount to admitting that the scheme is not all that good anyway. Obviously the exact provisions will have to be adjusted if only because the hardship of the Minister and the hardship of the smallholding authority is different from that of a landlord. But what is sauce for the goose is sauce for the gander. Some gander! The right hon. Gentleman will have to find more justification for his line than he has so far.
Smallholdings have played a useful part in launching new entrants on the farming ladder. Where will they go now? How are they ever to move on? Where will the farms to let come from? No doubt the big estates will carry on in their admirable tradition, but for the small and medium estates there is no incentive to let. There is a positive discouragement to let to anyone except to a tenant who has no relations and is unlikely to acquire any; otherwise the landlord says goodbye to his holding for the lifetime of his tenant, as he does now, and for two subsequent successions. What does the Minister mean by legislating for the intermediate stage of two successions? That was an obscure bit of small print fitted in in the hope that I would not notice. A tenant for life and two successions might last for a century, which is too long. Not only does that deprive the landlord of some of his fundamental rights as an owner of property; it denies him the right 64 to exercise his judgment on who is the best tenant for the farm.
I am sure that it will not have escaped the notice of hon. Gentlemen opposite that about a month ago the Farmers' Guardian, in an article called "Viewpoint", regarded this as "a highly dangerous precedent". The independent judgments of landlords, no less than of tenants and everyone else in the industry, are of the very essence of the success of the landlord-tenant system. I wonder why the right hon. and learned Gentleman finds that so funny?
There are other consequences and implications of this scheme which I do not have time to explain and deploy without trespassing too much on the time of the House. For example, there is the likely effect on the level of rents. What is the Government's assessment of that effect? There is the need to find new and additional encouragements to induce landlords to let their land, without which the whole system cannot work. There is also the desirability of examining the possible use of fixed-term tenancies in certain circumstances. That must arise in the context of what is proposed in these new clauses.
All these and many other matters can be discussed in Committee, because the House would not wish and ought not to legislate on the structure of agriculture without full awareness of all the implications.
I think that the House would agree that agriculture has been one of our outstanding national successes—progressive, innovative and technically excellent. There are many reasons for this, and I want to conclude by referring to one of them.
Since the war, until a couple of years ago, the broad strategy for sustained improvement in the production of homegrown food was not a party political matter. We were all on the same side. Of course, mistakes were made and there was plenty of scope for criticism in detail, but the broad sweep of policy was something about which we were all agreed. It was important to the national interest as well as to the industry itself, for which continuity of policy and stability are absolutely crucial. It would be a shattering tragedy if the common 65 ground were to be broken. Worse, it would be a failure of political leadership.
In a mixed variety of ways, of which this scheme is only one, the Government are playing fast and loose with the structure and the long-term well-being of this great industry. Our farming has been nurtured over the decades, and the responsibility lies with this House to carry that work forward.
The House takes note of these new clauses. I am not advising my right hon. and hon. Friends to vote against the motion. I hope that the Government will be flexible in Committee. Certainly the right hon. and learned Gentleman indicated flexibility and referred to the new clauses as deserving of the fullest consideration. I entirely agree. I am glad that the Committee is to be set up again to consider this matter. But let the Government take note of the deepening alarm and awareness on these Benches that the future prospects and prosperity of our agriculture lie today in unreliabe hands.
§ 5.3 p.m.
§ Mr. Caerwyn E. Roderick (Brecon and Radnor)
I believe I am right in saying that the right hon. Member for Cambridgeshire (Mr. Pym) was not present on the Second Reading of the Agriculture (Miscellaneous Provisions) Bill. Yet he was keen to refer to the absence of my right hon. Friend the Minister of Agriculture, Fisheries and Food. If the right hon. Gentleman had taken the trouble to read carefully the debate on Second Reading, he would have seen how these new clauses had come about. I agree with my right hon. and learned Friend the Secretary of State for Wales that the right hon. Gentleman should withdraw the allegation that there has been something underhand here.
§ Mr. Roderick
Surely "underhand" is parallel to "back-door methods". The right hon. Gentleman suggested that back-door methods were being adopted. We made clear on Second Reading what we were attempting to do. If the right hon. Gentleman is suggesting that Back Benchers have no right to bring pressure on Administrations to bring forward 66 legislation, he is doing a disservice to this House.
§ Mr. Roderick
Would I be wrong in interpreting the right hon. Gentleman's remarks as meaning that he felt that it was deplorable that Ministers should give way to and bring forward legislation as a result of such pressure? I believe that that is the only interpretation which can be put on his remarks.
On Second Reading we lamented the absence of provisions for some measure of justice for the near family of a tenant farmer on his death. Together with some of my hon. Friends, including my hon. Friend the Member for Durham (Mr. Hughes), I promised that if Ministers failed to bring in new clauses we would ensure that new clauses were introduced. In order to concentrate the mind of the Minister on this problem, we tabled such a new clause and were delighted to withdraw it when we saw that the Government had brought forward these new clauses. I wholeheartedly welcome the new clauses and thank my right hon. and hon. Friends and the Ministry for the work that they have done on producing and introducing them. I accept that it was not an easy task. The complexity of the situation is apparent from the fact that we have so many new clauses.
In commenting on one or two aspects of the new clauses, I do not wish to detract from their major purport in any way. However, I feel that we should consider going a little further.
We have come across cases of tenant farmers in serious ill-health hanging on because they were unsure of the future. I think that there is a strong argument for considering handing over the succession before death. If a farmer wishes to retire due to ill-health, we should consider allowing a near relative to take over at that stage.
I note that new Clause 10, in subsection (8)(b), refers tothe age, physical health and financial standing of the applicant67 being taken into account by the Agricultural Land Tribunal. These are interesting points. I should like to know more about the strict criteria which will be applied in the age, financial standing and health of applicants.
In other spheres employers are compelled, for instance, to employ at least 3 per cent. of their work force from among registered disabled. Would a disabled near relative of a tenant farmer be disqualified? Are we to have one law in one area and another in this area? I do not think that health should be a barrier. I should like to know more about the Government's thinking behind introducing this feature into the new clauses.
What does "financial standing" mean? How much finance must a person possess in order to succeed? How old must he be? Is there to be a minimum or a maximum age? I can understand a minimum age being stipulated in certain circumstances. What would the minimum age be? What would the maximum age be?
I disagree with my right hon. and learned Friend's argument that only two transfers should be allowed. This point arises from new Clause 8. My right hon. and learned Friend referred to the average tenure being 40 years. But the two transfers in subsection (5)(f) do not refer to transfers from one generation to the next. The transfers could be to brothers. The whole operation could be finished within two or three years. In those circumstances, that provision would completely vanish. I cannot see how the situation is changed at the end of two transfers. Why should there be a qualification of that kind? We shall have to reconsider that provision.
New Clause 8 makes stipulations about relatives being at university, college or any other institution pursuing an agricultural course. As I understand it, there could still be qualification on the basis of a three-year agricultural course. That would be within the five-year qualification period. But I think that we are being somewhat narrow minded. Difficult situations will arise if we restrict it to agriculture.
§ Mr. Mark Hughes
As I understand the drafting, a degree course in agricul- 68 tural economics is not a sufficient qualification to be considered. That is ludicrous.
§ Mr. Roderick
That is an example of how difficulties will arise. I am glad that my hon. Friend has brought that matter to our attention. What is wrong with studying economics? Surely such study makes a better farmer.
I spent some years teaching in an area in my constituency, and I was privileged to teach up to O-levels one of the cleverest persons I ever taught. He lived on a poor little farm, and it was thought by his family that it would be better for him to leave school at 16 to work on the farm. I tried my best to persuade the family that he would be a much better farmer if he pursued his education as far as possible before working on the farm. It is sad that farming communities in rural areas should be deprived of the best expertise. The young man to whom I have referred is a most valuable asset to his community, but I believe he would have been an even greater asset if he had gone to university, regardless of the subject he chose to pursue.
I believe that agriculture is perhaps too narrow a study to lay down as a qualification and that three years is too short. Many college courses run for four years. That is especially true of sandwich diploma courses, for example. I am sure that my hon. Friend the Member for Durham will elaborate on that.
On Second Reading of the Agricultural (Miscellaneous Provisions) Bill, and in Committee, Opposition Members kept saying that a much wider debate was necessary and that much more time was needed adequately to debate the issue. But they never said where they stood. I hope that they will come clean and tell us whether they are in favour of or opposed to this sort of legislation. I hope that they will come clean instead of nitpicking on various details.
The Opposition have said that the Bill is not the vehicle for introducing this legislation. They know that if we were to wait for what they would term the appropriate vehicle, we should have to wait a decade. There would be that delay because of the pressure on parliamentary time.
69 Opposition Members argue that the supply of tenant farms will dry up under this legislation. My experience is that the supply is drying up under existing legislation. On the death of a tenant the farm is often taken in by the landlord to be sold, not being made available to another tenant. The Opposition give the impression that there is a massive supply of tenant farms coming on to the market, but that is not the situation in my area. I cannot see that this legislation could stop what in fact does not exist.
§ Mr. Roderick
I believe that landlords are trying to make as much as they can by selling the farms. They are choosing to sell while prices are high. That is what is happening in my area.
§ Mr. Roderick
I invite the right hon. Gentleman to examine the situation in my area. I am giving the House the evidence that has been presented to me.
Opposition Members say that the landlord-tenant relationship has been good. They say that in most instances landlords are sympathetic. I agree that they are in most cases, but are the Opposition saying that we do not need to legislate for the remaining cases? The argument that generally people behave responsibly, wisely and sensibly is true in most walks of life, but according to the Opposition's thesis it is not necessary to legislate on anything, merely to accept that everyone is sensible. We are legislating because certain people do not behave sensibly.
If the Opposition are so concerned about local authority smallholdings and the Minister's smallholdings, I invite them to table amendments. If they do so, they may enjoy a measure of support from some of my hon. Friends.
It is not true to suggest that we have plenty of farms coming on to the market. There is a shortage of tenant farms, and I hope that we shall afford a certain degree of protection by this legislation 70 for those who are well acquainted with such farms. I hope that it will be accepted in principle.
§ 5.16 p.m.
§ Sir Timothy Kitson (Richmond, Yorks)
I welcome the opportunity briefly to enter this debate. I am most grateful to my right hon. Friend the Member for Cambridgeshire (Mr. Pym) for the way in which he made his introductory speech. He covered many of the most relevant points that are worrying all of us. The hon. Member for Brecon and Radnor (Mr. Roderick) and I generally serve at this time of day on the Public Accounts Committee. It is rare that I have to disagree with the hon. Gentleman in that Committee, but I must disagree with some of his comments in this debate.
As my right hon. Friend the Member for Cambridgeshire said, landlords are not clawing back land to farm themselves or because they wish to sell; they are doing so because of the swingeing taxation that has been imposed upon them in recent years. We are worried that if this legislation is enacted in its present form it will further dry up the supply of tenanted land.
I represent the largest constituency in area in England. There are many small and large estates in my constituency, and the problem of hereditary tenancy has been discussed for many years. I have often found in Yorkshire, and in my part of the world generally, that on the larger estates the view has been taken that, where possible, sons of tenant farmers should be given prefential treatment and allowed to continue the tenancy on the death of their fathers. I know that that has not happened on every occasion, but it is a principle that is often adopted.
In many cases farmers have worked in partnership and many have devoted a substantial part of their working life to the tenant farms of their fathers. They have often assisted by intoducing additional capital into the farming enterprise. I believe that they should be allowed to succeed. If the hon. Member for Brecon and Radnor does not know where we stand, let me tell him that is my view. That also applies to brothers working in partnership.
The clauses will overcome cases of hardship that we have all seen in our own constituencies. Although the NFU argues that discussions have been taking 71 place between the CLA and the Ministry of Agriculture, Fisheries and Food since as long ago as 1968, I am worried that not all the necessary preparation has been considered. I hope that substantial amendments to the clauses will be made in Committee. If that does not happen, anomalies will arise.
If the clauses are passed it will be the small estates which will run into difficulties. They have far less opportunity to manœuvre. As has been said, changes in our taxation system have dried up the market. The penal taxation that is imposed on landlords—for example, capital transfer tax—and the threat of a wealth tax has forced landlords to try to keep some liquidity within their estates to meet additional taxes. For that reason, in the past few years more and more land has been clawed back into the hands of the owner to be farmed by the owner. In some areas this has had an adverse effect on tenants' sons. I foresee that if these clauses are passed as drafted, future lettings will be at substantially increased rent.
Recently, between where I farm and the constituency of the hon. Member for Durham (Mr. Hughes), a farm was put up, the market value of which would have been, in the judgment of most people, about £15 an acre, but it was taken for £30 an acre. In my judgment, this was partly not because of the value of the land but partly because the tenant was of the opinion that, if these new clauses went through, he would have the continued possession that he could not expect from a new and normal letting.
I am sure that, if the clauses go through as they are, rents will be substantially increased—already they are at a high level in some parts of the country—and the expansion of food production will become more difficult because of the shortage of cash due to the higher rents that tenants have to pay. It also means that the farming ladder, which already has many rungs missing, will become increasingly difficult to climb. That is why so many young farmers are opposing the clauses. They have set their hearts on farming—their parents may have died—but they will find it almost impossible to pursue a farming career unless the Government look at the swingeing taxation on landlords.
72 If we are to accept in principle these new clauses, it is also difficult to accept as good any reason why smallholdings operated by the Minister and the local authorities should be excluded. My right hon. Friend dealt with this point, but I can see no good reason for excluding the holdings of county councils.
Many of us have had representations from the County Councils Association asking for exclusion, but why should the private owner be in a different situation from that of a county council or, for that matter, from that of the Minister himself, since he appears to be exempting the land that he administers? Some smallholdings have substantial capital investment in them, and the son of the tenant may have much larger capital investment in such a tenancy than he would have on land owned by a private landlord.
Will the Minister explain the position of Ministry of Defence land? Around Catterick, the Ministry of Defence owns a large number of farms and smallholdings. What is to happen to the sons of those tenants? For defence reasons, at present most of these smallholdings are let on a 364 days a year tenancy, which means that the occupants can be turned off at the end of any year. If we are to accept these new clauses, the position of these individuals must be carefully considered. The same applies to many other parts of England where families have been on defence land for years. They need safeguards under the Bill.
I have in my area many small estates of about 1,000 acres, some of them with only five or six holdings on them. How are these owners' sons to get an opportunity? I do not believe that they would be covered by the hardship provisions in the new clauses. For example, there will be cases where, perhaps a generation ago, the family decided not to continue to farm and its members have gone into other jobs, but where relatives now wish to return to start farming again, in order to bring the unit back into a viable holding. It will be very difficult for them to do so. I hope that the Minister will look carefully at that point.
I am not as happy as the Secretary of State is about the land tribunals. I am not satisfied that they have enough experience or enough staff to look into some 73 of the difficulties with which they will be confronted. For example, I do not believe that they use their assessors as much as they should. I hope that the Minister will look carefully at the membership of the tribunals and consider whether it is necessary for further appointments to be made and to insist that, instead of using them by chance, they should use assessors on practically every occasion when these hereditary tenancies are under consideration.
I hope that the Standing Committee will look at these new clauses very carefully and amend them considerably. I welcome the safeguards for the sons of tenants, but I question the wisdom of extending those safeguards to other dependants. I regret the Minister's decision at this stage to exclude his own smallholdings and those of county councils. I recognise the difficulties that a small landowner has at a time when the whole pattern of agricultural policy changes considerably as each decade goes by. I worry about the present taxation level on agriculture. And I hope that the Government will make the necessary amendments in Committee.
§ 5.25 p.m.
§ Mr. Gwynfor Evans (Carmarthen)
I give a broad welcome to the Government's proposals. I have long felt that tenants' sons in particular, although other close relatives, too, should be given more security than they now have. I would like to see Wales enjoying parity with Scotland in this matter, as in other constitutional issues. I do not hear many complaints from Scotland about the way in which the security given to tenants' sons there is working. It seems to have improved agriculture and the quality of farming, the holdings and the land in Scotland.
I want to give an example from my own neighbourhood of the need for this kind of legislation. It is of a farmer who became a tenant on his farm in 1938. His son began farming with him on the holding when he was still in school. For 30 years, the son was with his father full time, working on the farm. There was a very good relationship between tenant and landlord—one of mutual trust and respect. It was understood that the son would succeed his father. That assurance was given to the father by the landlord. 74 For the last eight years, after the father had retired, the son was working the holding full time and alone, maintaining his father's standards.
Then the landlord died and a little later the father himself died. That was in 1974. Within a fortnight of the father's death, the son was shocked to receive a notice to quit from the new landlord. There had been and could have been no complaint about the way in which the farm was being run. It was being very well farmed. Yet here was a man in his late forties thrown out in 1975 without another farm to go to, without another job to go to, and without another home to go to.
Since he was thrown out, the land has been used for wintering sheep, and I understand that the farm house may be used for a holiday home. There is an obvious defect in a law which allows a tenant to be treated with such harshness. It is due to be corrected, and this should be done quickly.
That is not to say that every tenant and every tenant's son should unquestionably have the right to guaranteed security of tenure, irrespective of other factors, such as good husbandry. The landlords and the sons of landlords have their rights, as do the sons of the tenants. The good landlord, I think everyone in agriculture accepts, is a fine institution and his rights must be safeguarded. What is needed is that the tenant should have the right to appeal to a tribunal which can decide whose hardship is the more severe—the tenant's or the landlord's. There could be a conflict of interest, for example, between the landlord's son and the former tenant's son, and the tribunal should be empowered in that case to do justice, giving the question of good husbandry high priority in its consideration.
Often the landlord is not a working farmer. The landlord may be a bank, syndicate, or big estate. There is then a strong case for giving the tenant farmer's son who works on the farm an absolute right to succeed. He should be denied that right only by a working farmer who urgently needs the farm for himself or perhaps a close relative who is or wishes to be a working farmer. Even then the tribunal should decide. It will not find striking a balance of hardship easy, but it is possible.
75 As the Secretary of State said, three factors among others should always be considered—an ability to farm well, an interest in farming well, and a personal connection with the farm in question. Farming friends of mine tell me that in such circumstances they see no objection to awarding a farm for a probationary period of, say, five years during which the tenant will be able to prove the adequacy of his standards of husbandry. There may be strong objection to that, but it should perhaps be considered.
We have heard talk of the fear of a growing shortage of farms to let and, because perhaps of the new security for tenants, it is alleged that the number of farms to let will become smaller. We have heard, too, of farms let as holdings by county councils. There is a connection between the two. We have heard that county council holdings will not be subject to the legislation. I think that they should be. But I also think that that there should be many more county council holdings. That is one way of obtaining more farms for young farmers.
§ Mr. Hawkins
Will the hon. Gentleman make clear whether he agrees with the Minister's proposal to exclude smallholding land from the operation of the Bill? I was not sure what the hon. Gentleman said.
§ Mr. Evans
Clearly the hon. Gentleman did not hear me say that I do not approve of its exclusion. Such holdings should be included. There should, however, be far more of them. There are many more in the east of England than there are in my part of Wales.
I should like the Government to encourage the Dyfed council, for instance, to invest much more in the purchase of farms. It may be said that in a period of cuts in public expenditure this is a bad time to be making such a suggestion. However, the cost of land is less than it was two or three years ago. Therefore, from that standpoint, it is a good time for councils to purchase more land and to let it to young farmers, in particular. I hope that the Government will consider this matter and that the Secretary of State and the Treasury will co-operate with the county councils to ensure that there are more farms to further this necessary policy.
§ 5.35 p.m.
§ Mr. Norman Buchan (Renfrewshire, West)
I am glad that this matter is being discussed in the House. I should declare in advance that I have no personal interest in it. I am not a private tenant or a landlord, and I have no direct connection with England and Wales. My one justification for speaking is that I was involved with the introduction of similar legislation in Scotland seven or eight years ago, and therefore I may have relevant experience to contribute. Some of the arguments we have heard from the Opposition are not dissimilar from those which we heard when I was putting similar legislation through the House.
I welcome the Government's decision to introduce legislation on this subject and to take the opportunity of doing so while the Agriculture (Miscellaneous Provisions) Bill was being considered. I repudiate in his absence—it is not my fault that he has left—the suggestion of the official spokesman for the Opposition, the right hon. Member for Cambridgeshire (Mr. Pym), that there was something underhand or back-door about the way. Not only did he suggest it; he refused to apologise when the suggestion was repudiated by my hon. Friend the Member for Durham (Mr. Hughes). I repudiate it, too, and point out to the Opposition that, regardless of what the Government intended to do, a number of my hon. Friends tabled proposals on this subject. There has been no collusion whatsoever. On the contrary, we should welcome the fact that the Government take note of pressure from outside and inside the House and implement justice as quickly as possible. That is what they propose to do here. We have heard less nonsense today than we heard in Committee where there is perhaps less Press coverage.
The right hon. Member for Cambridgeshire was rather more subtle than some of his colleagues. He wove his way between the two positions even more skilfully than they have done in the past few weeks. In Committee, where we have been discussing clauses relating to holdings, arbitration, and so on, hon. Members opposite have been willing to wound but afraid to strike. The tenor of their arguments has been in defence of the landlord and against the interests of the tenant farmer.
77 I was therefore pleased to hear the speech of the hon. Member for Richmond, Yorks (Sir T. Kitson), because he is the first Member of the Tory Party who has come down on one side or the other on this issue. He said that he welcomed the proposed new clauses but wished them to be amended. I congratulate the hon. Gentleman. He is one honest man shining like a light in all the murkiness created by hon. Members opposite. I do not know whether that will do him any good in his party, but it may do him some good among the farming community and his constituents.
The argument deployed in the past and today has been related, first, to the proposals, and, secondly, to the method by which they have been introduced. Let me deal with the second point first. It is curious that this is not an unprecedented situation. It happens time and again in legislation that a fairly important matter of principle is introduced in Committee. We know the reason for it. The House is cluttered up with legislation and it is difficult to find time for it. I do not blame the Government for cluttering up the House with legislation. They had a lot to clear up from the four dreadful years from 1970 to 1974. All Governments have introduced important matters in Bills in Committee upstairs.
Secondly, there is a precedent for clauses of the type proposed by the Government even in agriculture legislation. In Committee I introduced for Scotland the same proposals as those put forward for England and Wales. I therefore hope that the Opposition will not continue to shelter behind the apparent procedural argument, as though the Government were harming the fabric of the House and bringing democracy into disrepute. The Government were right to do it in this way.
That deals with the second piece of nonsense. [HON. MEMBERS: "Arrogant."] I am not being arrogant. It was a piece of nonsense, and hon. Members opposite know it. They have introduced such arguments to avoid saying whether they are on the side of the tenant farmer or on the side of the landlord. They wanted to please both. Basically they were on the side of the landlord but did not wish to be seen as not being friends of the tenant, so they put forward the procedural argu- 78 ment. That is the modest, humble, simple truth, and hon. Members opposite know it.
Will the Government's proposals destroy the landlord-tenant relationship? I agree that it will alter the relationship, but it requires alteration. The right hon. Member for Cambridgeshire has not told us what his position is. He did not say, in his long speech, whether he was for or against the new clauses. He made all sorts of criticism, saying that things should change. But has not yet said whether he is in favour of the principle.
§ Mr. Buchan
The Opposition are saying again that there is a case for preferential treatment of the close relatives of tenant farmers and for a system to avoid hardship, but they do not say these should be introduced now and they will retain that attitude for as long as possible. Their position offends against the Sex Discrimination Act. Are they saying that a tenancy should pass to a son but not to a daughter, to a widower but not to a widow? Are they not aware of the work, skill and success of many women in farming? On one immortal occasion, I said by sheer accident—and unfortunately did not correct it in Hansard—that some of our best breeders are women. Some of our best farmers are women and the Opposition's attitude is reactionary and should be rejected.
The right hon. Member for Cambridgeshire has still not said whether he supports the new clauses. I gave way to allow him to answer, but he has still not replied.
§ Mr. Buchan
Does the right hon. Gentleman accept the principle? A number of hon. Members may make comments and say that the clauses need changing. I have made many comments myself and would like to see some changes, but I accept the principle. Does he and do the Opposition? Are they 79 afraid of their farming constituents? I am willing to give way again if the right hon. Gentleman wishes to give a definite answer.
There is a curous contradiction in the Opposition's position. They say that they dislike this principle but then wish to extend it to tenants of county councils and the Ministry of Agriculture. They should realise that there is a difference between a landlord who is democratically elected and subject to scrutiny and control and one who is not subject to such scrutiny and control. The Opposition have a curious concept that all landlords are good. It is not true. The Opposition think that the judgment of landlords is perfect. It is not true. The Opposition object to tribunals deciding the matter and are therefore saying that the judgment of landlords is superior.
They poke fun at us for basing the principle on heredity. Far from that, I think there is a case for extending the new clauses to farm workers who have been on a farm for many years. The Opposition claim that the clauses will reduce the number of new entrants into farming. My suggestion would assist. If a skilled farm worker met the other requirements in the clauses, he could be helped by being given the tenancy. Would the Opposition support that? It would bring in new entrants to farming and ensure that the necessary skills were maintained.
The educational requirements in new clause 8(4) seem to be far too narrow. Would my hon. Friend the Under-Secretary qualify under these requirements? He is one of our most distinguished agriculturalists. He is a distinguished animals geneticist and the son of a farmer. He was brought up on a farm and knows farming inside out. Yet I am not sure that he would qualify. The requirements are too restrictive. If my hon. Friend does not qualify, they are certainly drawn far too closely.
We have had a reasonable discussion so far and I hope to hear more interesting things in the next one and a quarter hours. Perhaps someone from the Front Bench opposite may feel it in his heart to say whether the Opposition accept the principle of the new clauses and whether they are on the side of the landlord or of the tenant farmers.
§ 5.46 p.m.
§ Mr. Patrick Mayhew (Royal Tunbridge Wells)
The Minister prefaced his remarks by saying that he did not wish it to be thought that it was his view that the system of landlord and tenant had not been of benefit to the industry and the country. The theme of his speech was that these proposals would enhance the efficacy of that system. If the Minister had done his homework, he would not have introduced far-reaching proposals which will have such a major effect on one of the two limbs of the landlord-tenant system by means of a side wind or in new clauses in the Bill. A profound change is being made in the system which insidiously, but substantially, undermines the position and strength of the landlord as a supporter of the system.
The Government are conferring upon tenants the right to secure the succession to their sons and grandsons for 80 years or even 120 years of the right to farm that land. They are conferring on the tenant a virtual freehold. For the Minister to say that he does not wish to undermine the position of the landlord or effectively to alter the landlord-tenant system is disingenuous. Either his conversion to the principle behind these proposals has been superficial or he has not adequately done his homework.
The object is said to be the avoidance of hardship and the improvement of tenant farming. Yet we see that 11,000 tenants of councils and the Ministry are excluded from the scheme. If a man is a council tenant he is not, by some magical means, immune from hardship if he is unable to pass on his holding to his son. If a man is a tenant of the Ministry, he is not incapable of improving his farming technique. The only explanation from the Government for the exclusion of these tenants is that the landlords operate in the full view of public opinion and the tenants do not therefore need this sort of protection.
§ Mr. Peter Hardy (Rother Valley)
Will the hon. Gentleman reconsider two comments he made? First, good landlords already treat their tenants in the way in which my right hon. and learned Friend proposes that they shall be treated generally. Secondly, many county council holdings are so small that farmers have to work unduly hard to get a living from them. In that case, we should be careful 81 not to make the system permanent, because it imposes a hardship.
§ Mr. Mayhew
I concede, as has been conceded by my right hon. Friend, that this practice is followed by many good landlords, and I wish that to continue. The difficulty is that in seeking to make statutory what is good practice, in most cases the very system which it is desired should be upheld is undermined, and the result is the destruction of what is good in an attempt to impose statutorily measures which are intended to lead to an end which everyone wants.
There is great advantage in retaining for the landlord the ability and right to choose the tenant for his farm. The landlord is not disinterested in the future of his land or ignorant of the qualities of the farmer his land requires. To deprive the landlord of the opportunity and the right to choose the person who will farm his land is wrong and bad in the interests of farming.
The good landlord will wish to enable the tenant farmer's son to continue where he is an appropriate and suitable candidate, but to oblige him to do so where the Agricultural Land Tribunal says so is dangerous. In my experience the Agricultural Land Tribunal has never been called on—nor has any similar tribunal—to determine the right of rival applicants for a tenancy. Yet that is what these clauses propose. That is of profound significance. It is different from anything that the Agricultural Land Tribunal has ever been called on to do and it has no qualifications for so doing.
The arguments put forward by my right hon. Friend the Member for Cambridgeshire (Mr. Pym) call for an answer. They are matters of significance pointing to a feature of the proposed legislation which does not seem to have been properly thought out. It is not surprising that the young farmers are against these proposals. One of the great dangers confronting farming today is the difficulty that young people have in getting their foot on the ladder. Although it is hard now, it will be harder still if these proposals are enacted for a young man who does not have the accident of birth to rely upon to get on to the ladder that leads to the tenancy of a holding of any size.
82 Why are these fundamental proposals introduced in this way? The hon. Member for Renfrewshire, West (Mr. Buchan) does not provide a justification for this mode of legislating by saying that he relied upon it to bring about the same results in Scotland. If the Government are convinced that there is merit in these proposals, they have yet to explain why they did not introduce them in a more considered context. On the other hand, if they have only recently been converted to the proposals, the manner in which they have presented them to the House indicates that they have not done their homework.
My right hon. Friend was right in saying that far more time needs to be taken to consider these proposals. There are many aspects of them which are fundamentally dangerous to the system which the Government say that they wish to uphold, and they may do fundamental damage to agriculture. I hope that, in winding up the debate, the Minister will say that there are large areas of this legislation which the Government, on reflection, will reconsider.
§ 5.55 p.m.
§ Mr. Mark Hughes (Durham)
I played some small part in the drafting of the original proposals which have now been withdrawn.
The right hon. Member for Cambridgeshire (Mr. Pym) and the hon. Member for Richmond, Yorks (Sir T. Kitson) both started by saying that they agreed that preferential treatment should be given to the working son of a farmer and that there should be machinery for dealing with hardship. It was from that starting point that I and my hon. Friends commenced when we examined the Agriculture (Miscellaneous Provisions) Bill. We recognise that our prime duty as Members of Parliament is the redress of grievance, and in our constituencies and elsewhere we have come across clear examples of grievance.
I accept that hard cases make bad law, but I do not agree that the continuation of hard cases is an automatic condition of making good law. I know of a farming family in my constituency which has farmed a holding for 111 years. For the first 90 years there was a succession of landlords, and in the last 20 years the landlord has been changed three times—
§ Mr. Hughes
It has nothing to do with taxation. I trust that the hon. Member for Weston-super-Mare (Mr. Wiggin) will refrain from speaking in his usual ignorant manner on matters with which he is, as usual, unacquainted.
When the existing tenant died in his farmyard on a Sunday morning, his widow and son were given a notice to quit by a landlord whose interest in the farm had subsisted for less than two years, whereas their family continuity was 109 years.
It was to remedy that sort of inequality of treatment that we saw the need to do something. I am not sure that this is the correct way of doing it. It would be boastful to suggest that we had it perfectly right. We are, therefore, happy to withdraw the clause and are content with the substance of what the Government have put down. But that there is a widespread and clear need to deal with this grievance is common ground between all parties.
There have been a few cases in which the operation of the Agricultural Holdings Act 1948 has led to unnecessary hardship and distress. I accept that these are rare occasions and that in the great majority of instances there has been an amicable settlement of succession from father to son. My hon. Friends and I were—and the Government are now—determined that there should not be a statutory right of succession. That was the first solution that was thought of and it was rejected. That is not the solution that is proposed in the amendments. Legally, it would be easy to provide a statutory, absolute right of succession, but it would be unwise. We wanted to find a means of adjudicating the difficult and delicate relationship between a landlord and a potential tenant.
There seems to be an instrument at hand which can be used for that purpose. I have much greater faith in the ability of the Agricultural Land Tribunal than have certain Conservative Members. Its working in the North of England and in some parts of Wales has led me to believe that this task is well within its existing competence and experience. One accepts that sometimes it will not come to the 84 same conclusion as oneself or as the tenant or the landlord. However, its competence is such that its judgment will be superior to that of the landlords' agents.
There is one problem which varies from one part of the country to another concerning the institutional rather than the personal landlord. In the County of Durham, for example, the Church Commission, the Dean and Chapter and the National Coal Board are three of the four largest landlords. Here the power of the agent is crucial. There is no personal relationship between the landlord and the tenant. The hon. Member for Richmond, Yorks, will know from his experience in North Yorkshire some of the difficulties which exist with institutional landlords where personal contact is absent.
I turn to a matter which was raised by the hon. Member and on which I find myself in total agreement with him. After reading the new clauses I am concerned with the position of the owner of the very small estate and his children who may have a very legitimate claim and who, from my reading of the clauses, do not appear to be covered. Take the case of a landlord who went away to the war between 1939 and 1946. For various reasons the landlord when he returned did not want to take up farming. Now his son may have been through agricultural college and may be acting as a manager on someone else's farm. In due course the old family home, which migh have been owner-occupied up until 1939 will become vacant. That son should be given an equal chance to undergo the relative hardship test. Perhaps the Parliamentary Secretary of State will say whether this point is covered or whether an amendment is needed.
I come to the exclusion of county council smallholdings and other statutory holdings. I would be happier about their exclusion if I were convinced that the maintenance of these tenancies on the lowest rungs of the ladder—because clearly that was what the county council smallholdings were established for—would remain open as the former tenants moved up the ladder. However, since in many parts of the country the county council holdings have been amalgamated to provide totally viable family farms in their own right, their exclusion demands more 85 justification than we have so far heard. I would be content to see a modification of the application of the tribunal to county council holdings because of the rôle that these holdings were created to play in terms of agricultural advancement. The county council smallholdings of under 50 acres must be kept free to enable a continuity of access into the industry from the hind or from among the labour.
I would be happier to rely upon the public spirit and good judgment of my right hon. Friend the Minister of Agriculture and his successors were it not for the fear that the hon. Member for Westmorland (Mr. Jopling) or one of his ilk might at one time be in that position. I would be much happier to protect the tenant farmer from the vagaries of Tory Ministers of Agriculture than to leave him in his present condition under these proposals. I see no adequate reason as yet why the Minister of Agriculture's holdings, when he acts as landlord, should be excluded.
On the question of the main proposals—in which I accept that my proposals, ill-drafted though they were, played some part—I agree that there was a series of grievances and that we had to see how these could be remedied. The Agricultural Land Tribunal seemed to provide the appropriate solution. I shall be interested to know how those who have an interest are to be defined. There may be those in this House who believe that the efficacy of primogeniture is still unsullied. I am not certain that I would number myself among them.
There is a fundamental difference between giving preferential treatment to a son and giving it to a near relative. But after much thought I have come to the conclusion that to restrict it to the son, whether it be the eldest son or a younger son, and to exclude adopted children, sons-in-law, brothers and so on—those to whom in the reality of family relationship there has been a filial or paternal relationship—will be quite wrong. That was why I included grandsons and granddaughters in the original clause. I regret that they have been withdrawn, but the definition of "near relative" needs to be much wider than to include just the son. The claim of the hand who has worked on the farm, or even of the 86 bailiff, also needs to be considered. I have no more faith in the ability of the eldest son to produce a good landlord than in his ability inevitably to produce a good tenant. This must not be a statutory matter; it must be arbitrated.
§ 6.10 p.m.
§ Mr. W. Benyon (Buckingham)
I listened with great interest to the hon. Member for Durham (Mr. Hughes). I find his argument about County Council smallholdings rather convoluted. On his main point, it is one thing to say that we should seek to safeguard succession and avoid hardship but it is quite another to do it without upsetting the whole system.
I declare an interest, as I did in Committee, as the landlord of a tenanted agricultural property—I hope a good one. I am very glad that my right hon. Friend the Member for Cambridgeshire (Mr. Pym) said so strongly that the real reason for this system breaking down today has nothing to do with the landlord-tenant relationship and everything to do with the imposition of taxation, which will become more and more onerous.
We had the usual diatribe from the hon. Member for Renfrewshire, West (Mr. Buchan), but the Scottish system has not been in operation long enough for the real effect of the new forms of taxation to be felt.
§ Mr. Buchan
I do not accept, nor do most people who know the problem, that taxation has the effect that the hon. Member suggests. There are other reasons. But we have double experience. We had the system that the clauses now propose between 1949 and 1958 in Scotland. We then had a Tory interregnum up to 1968, since when we have again operated the system in these clauses, and there has been no real change in the flow of new farms for lease. The NFU in Scotland has assured me that it can detect no differences under the different operations.
§ Mr. Benyon
Views differ on that. It would be generally agreed by those with an unbiased view that, in the words of the Scottish law, it is "not proven".
The new clauses will not give us what we all want—more farms to let. If the landlord-tenant system is to go on, that 87 is what we need. The clauses will make matters worse. The system itself is finely balanced and, as the hon. Member for Durham implied, it is an argument between arbitrary and statutory.
§ Mr. Benyon
I accept that.
The Minister must tell us what advice he would give if he were a professional adviser to a landowner with a farm to let. Would he be able to avoid saying, "As things stand, the price of let land has dropped considerably even over the last few months as a result of this legislation and the converse is also true: in this situation the price of land with vacant possession will rise proportionately even higher?" That is also happening at the moment.
Second, could he avoid saying to this mythical landlord, "You will be losing control under these clauses for about one hundred years."? The period must be something like that. Would he not agree with a number of other hon. Members that it is essential to rectify this fine balance by giving some encouragement to landlords to let their land? That is what is missing from the clauses.
The first possible encouragement is relaxing taxation, particularly capital transfer tax. The Minister would do well to pressurise the Chancellor of the Exchequer to see whether some system could be evolved which related more nearly for tax purposes to the investment value of let land. Landlords and estates who adopt a low rent policy should be recognised in some way in taxation, because they are getting less from their assets. There is a possibility of such a system to give landowners an incentive to let their land.
Second, there should be a requirement that those eligible for succession, whatever the clauses decide, can take succession only when the existing tenant retires. In that way, the situation mentioned by the hon. Member for Brecon and Radnor (Mr. Roderick), in which a tenant goes on and on because he does not want to give up the holding, could be avoided. That would also involve suc- 88 cession by agreement. Perhaps we could consider that in Committee.
Third, I part company with the hon. Member for Durham on the question of the Agricultural Lands Tribunal. I agree with my right hon. Friend that we should consider whether it is the right body to consider difficult questions of succession. I accept that it has done a very good job, but these are much more ticklish matters and I should be happier if they were handled on a more judicial and less local footing. When it comes to knotty problems of assessing the personality of the landlord or the tenant, they will be difficult to solve on a local basis.
Fourth, something should be written into the clauses to deal with the succession of landlords' sons when, after a farm has been let because the landlord did not wish to farm it himself, the son wishes to take over at the end of the tenancy. That is a difficult matter and could be settled by compensation so that the tribunal decided that the landlord's son should be allowed to take over.
When it works properly, the landlord-tenant system has no rival. It confers great advantages on agriculture as a whole. But, as with all long-term arrangements, it requires trust, confidence and a sense of fairness to make it work. At the moment, the clauses do not provide those conditions. That is why they must be changed before the Bill becomes law.
§ 6.18 p.m.
§ Mr. Jerry Wiggin (Weston-super-Mare)
I must first declare an interest, in that I am a tenant farmer. I have been so since 1959, when I took over the tenancy of a farm from my mother, who had previously taken it over from my father. A good deal has been said about expertise today, and perhaps I can claim some as a tenant farmer. I have been a tenant of two estates and I think that I have some practical knowledge of the day-to-day workings of the system.
I could not have been a farmer at all but for the landlord-tenant system as we practise it. That system has been responsible for one of the finest systems of land tenure in the world and is certainly an example to Europe. But we are all agreed that the system is not working very well. I have here some figures 89 taken from a Ministry publication called "Farm Rents" and published by ADAS. They show that in the year to May 1975, out of a sample of 26,000 farms totalling 3.75 million acres, representing about 30 per cent. of the tenanted land, only 0.2 per cent. were re-let on the open market by tender and only 2 per cent. by agreement—mostly, although the statistics do not bear this out, to limited classes such as the sons of previous tenants. The figures for 1975 are bound to be even lower.
The 1948 Act, conceived no doubt in good will, is no longer working. Once security of tenure is given to the tenant, the landlord obviously will take every opportunity of taking his farm in hand. By re-letting it he loses it under the current law for at least the lifetime of that tenant.
By the very nature of farming it is essential that there should be some security of tenure. I do not argue about that. One cannot farm on a five-year basis; one must see a long-term programme ahead. I suppose that the tenure of one's lifetime was considered reasonable in the circumstances under the taxation that prevailed in 1948, and subsequent Conservative Governments have not seen fit to reverse that. However, the fact of the matter is that the pressure of taxation, combined with the existing security of tenure, has been enough to drive tenanted farms off the market.
If the hon. Member for Durham (Mr. Hughes) had, as I have, been to "tender" days on farms, along with 100 or 200 other potential tenants, knowing that the rent one would have to pay to get into the farm would be twice the economic rent, and knowing that the chances of expanding one's business as a tenant farmer were almost non-existent, he might have had the open-mindedness to open up the whole system and not to close it even more tightly.
It is, perhaps, sad that because of the lifespan on which security of tenure depends it is upon the death of the tenant that the landlord gives notice. The tear-choking examples given by the hon. Members for Durham and Carmarthen (Mr. Evans) occur at a time when, statutorily, a landlord is required to give notice within a given period—I believe that it is five or six months.
90 One would have thought that after the operation of the 1974 Rent Act, under which thousands and thousands of furnished flats were taken off the market simply because of an increase in the security of tenure, Labour Members would have learned the lesson. Now they are increasing it yet again, to a century or more for farms. It is no good hon. Gentlemen shaking their heads. It is three full generations. I took over my farm at the age of 21. My son is still only 10 years old, and by the time he has a family it could well be 100 years between my taking over the tenancy of my farm and my grandson dying. There is nothing imaginative about that. It is quite feasible.
What has happened? Thousands of acres are being farmed today not by the landlord or by the tenant but in partnerships—legal devices to get round existing legislation. Farms which should be on the open market and available to rent are not. Hundreds of farmers who should be tenants in their own right are merely acting as managers, with fewer rights than they would have had as tenants under the old law.
§ Mr. Buchan
The hon. Gentleman said that he took over his farm at the age of 21. He did not buy it. Did he inherit the tenancy from his father?
§ Mr. Wiggin
If the hon. Gentleman had listened to my opening remarks he would have heard me declare that I took over the tenancy from my mother, who took it over from my father. I have a landlord who takes a perfectly sensible and helpful view on these matters and who has allowed, by usage, almost every farm on his estate to be taken over by competent sons. Why legislate? There is no need to. If hon. Gentlemen had understood a little more the working of the countryside and had ceased to reveal their constant ignorance, as they did in Committee, we might get a little further.
The old tenant, even as long ago as 1875, enjoyed a measure of security of tenure. He had an automatic entitlement 91 to be compensated for residual benefits of work done on his holding. Now, as mere farm managers, the same people are but employees. It is this matter to which the Government should direct their attention. They should not make it harder and harder for landlords to let.
The Federation of Young Farmers' Clubs has written twice to us. It has so reserved its position that it would, perhaps, be unfair to quote the letters direct. But they make it clear that young people are ambitious. They are anxious for the agriculture industry to prosper. I invite the Minister to thumb through the British Farmer & Stockbreeder and to look at the column headed "Farms to Rent". Month after month he will find that there are no farms to rent, because they have been taken off the market.
If I gave up my farm I believe that my landlord would be well justified in selling my holding, because, as trustees, landlords now have to find a tranche of capital transfer tax within the next few years. My landlord has handed over to trustees to protect the estate against the ravages of taxation. I am not in any way involved in the management of the estate, and it would be wrong for me to become involved in an argument, but from the way they run their affairs one can see the pressures that bear upon disinterested landlords, because they are not interested in anything except preserving the entity of the estate and having land to let. That will become harder and harder for them.
§ The question of rent reviews has been swept over lightly, but if my landlord takes me to arbitration, which he is perfectly entitled to do, he will quote the most recently freely-tendered rents in or near the area. My hon. Friend the Member for Richmond, Yorks, (Sir T. Kitson), with whose speech I largely disagreed, made a valid point about the high rents that are being tendered. It is those rents that will be used as a yardstick to fix everyone else's rents. This measure will cost the tenant farmer millions in increased rents in the near future. The entire cause of this will be the clauses that we are rightly debating this afternoon. I hope that the Minister will deal with that matter, because if he has proposals to change the arbitration proce- 92 dures, they do not appear on the Order Paper at present, and if they do not, sitting tenants will suffer very badly.
§ I have been a branch chairman and a county vice-chairman of the National Farmers' Union. I am deeply disappointed in that union's attitude to this measure. I believe it was its prompting in the original circular that reminded Labour Members of the possibility of obtaining some support for this measure. I claim to have some knowledge of how the National Farmers' Union works. I am far from convinced—I have been a member all my working life—that that organisation has really and truly put to its members the desperate implications of what we are doing tonight.
§ Mr. Roderick
Will the hon. Gentleman confirm that the Young Farmers' Clubs organisation has put it to its members?
§ Mr. Wiggin
I keep giving way to hon. Gentlemen who do not listen to what I have said. I said earlier in my remarks that the Federation of Young Farmers' Clubs were not yet firmly agreed and had not passed a resolution. The National Farmers' Union has on many occasions claimed to have done this, but I, as an ordinary member, certainly have no knowledge of it. Would hon. Gentlemen like to go back to what the NFU said in 1968? It has changed its mind, without consulting its members, and has made a great mistake.
I had always believed that the NFU stood for two things—first, that it was not a tenant's union but a farmers' union and, secondly, that it believed in the right of property. To take away from a landlord the right to enjoy his property for a century or more cannot be said to be respecting the rights of property in any way. I accept the significant promise made by my right hon. Friend the Member for Cambridgeshire (Mr. Pym) to review all this legislation. I shall read into that my own interpretation.
However, I am wholeheartedly opposed to these proposals. They are totally damaging to the system and expensive for the tenant, they will restrict new entrants into the industry and, above all, create lasting bad blood in many parts of the English countryside.
§ 6.29 p.m.
§ Mr. Charles Morrison (Devizes)
I hesitate to claim any great knowledge against the background of knowledge and experience of my hon. Friend the Member for Weston-super-Mare (Mr. Wiggin), which he has so ably described. I would not dare to claim any wisdom against the accusations and counter-accusations and ignorance that have been flung from one side of the House to the other and back again. However, on the other hand, I declare, like my hon. Friends, an interest both as a tenant and a landlord, albeit in Scotland.
I want to take up one matter raised by the hon. Member for Carmarthen (Mr. Evans). He said that there had not been any complaints from Scotland about the amendments to the law for which the hon. Member for Renfrewshire, West (Mr. Buchan) claimed credit. I echo the words of my hon. Friend the Member for Buckingham (Mr. Benyon) that it is early days yet. What was relevant before the interregnum that ended in 1968, in terms of the situation in Scotland, is certainly not relevant to the present situation, given the considerable increase in taxation.
As I am declaring an interest in this question, I can say as a landlord that in Scotland I shall never again let a farm that comes into hand, for the reasons already described by my hon. Friend the Member for Weston-super-Mare. It is very unlikely that any farm will come into hand. I suspect that my approach is not unique. I suppose that if I were to stretch a point, for some reason, I would be prepared to let a farm—perhaps an outlying farm—but, if I did so, it would only be to a spinster of a very particular type who, in addition, and in any case, was well past childbearing age and had no brothers or sisters.
The Secretary of State for Wales rightly said that the relationship between the tenant farmer and his family and the landlord is peculiarly close. Because it is so close, the House must be very careful about the way it intervenes in that relationship. Neverthless, I am prepared to accept that there is a case for amending legislation. Some of my hon. Friends from some parts of the country, because of the rare and occasional case brought to their notice, believe that that is so. The National Farmers' Union believes, rightly 94 or wrongly, that it is necessary for amending legislation to be introduced. The hon. Member for Durham (Mr. Hughes) has pointed out that the provisions of the 1948 Act have occasionally led to hardship.
I believe that if there has to be legislation it would be much better if it were introduced after the sort of review suggestion by my right hon. Friend the Member for Cambridgeshire (Mr. Pym). Further, no personal evidence of the need for a change has been brought to my notice in my constituency. I have received no letters either in support of or in opposition to a change in legislation, but a number of farmers individually have expressed doubts and fears about these proposals.
Therefore, amending legislation must be seen against the background of a land tenure system which, broadly, works well, which benefits agriculture, which is helpful in terms of food production, and which is of benefit to tenant and landlord alike. Legislation, if there has to be any, must be a compromise, taking adequate account of the varying interests involved and of a broadly successful system.
The Secretary of State for Wales described the Government's attempts to find what he called a just balance. I believe that the Government's new clauses are neither a just balance nor a reasonable compromise. Instead, they are another very big nail in the coffin of the landlord-tenant system. They may indeed bring cheer to the hearts of the left wing of the Labour Party, just as the increases in capital taxation have done, but I believe that these proposals are a matter for sorrow and foreboding in tenants, actual and potential, as well as in private landlords.
The Secretary of State for Wales said that he thought that landlords' fears would prove to be exaggerated. I doubt it. The proposals treat landlords as incompetent persons. The hon. Member for Brecon and Radnor (Mr. Roderick) said that these provisions were introduced to cope with landlords who are not sensible, but the provisions cope with landlords of all sorts and kinds. The proposals assume that landlords will act in an overbearing way, which is almost entirely untypical. The proposals conclude that the landlord's right to choice and decision for tenant and tenancies should be removed.
95 Perhaps one should not have too much sympathy with the landlord, in spite of the temptations offered to us by the hon. Member for Renfrewshire, West. It is for the tenant farmer that we should have greater sympathy. I believe that he will come off worst. In the short term I am convinced mat there will be fewer lettings. If that is so, the rent for new lettings will be higher. That, in turn, will mean that the rent for sitting tenants will be fixed at a higher level.
It will be not so much the private landlord as the institutional landlord who will take advantage of this new situation. Already the institutional landlord is governed more by cold economic logic than is the private landlord, who has a great concern for the unity and fabric of the countryside.
However, in the long term, in any case, if we carry on as we are, there will be only institutional landlords or owner-occupiers. Private landlords will take land in hand or they will sell it. If there are only institutional landlords, again, their economic approach will speed farm amalgamation. That will mean faster change in the social structure of the countryside and still fewer farms to let and fewer farms in total. In turn, that will mean that many budding farmers will not find a tenancy. Alternatively, they will have to invest their money in owner-occupation, and that will mean that they will be able to farm many fewer acres. If there are more potential owner-occupiers, the price of land will rise still more. It therefore follows that there will be a demand for higher farm prices to justify the capital expenditure, to the ultimate disadvantage of the consumer.
I am painting a gloomy picture because I believe that it could result from these proposals. Luckily, there is still time for the design of a compromise that will not have the effects I have described. The Standing Committee has a hard task, as it will be building on pretty difficult foundations. If it does not achieve success it will be a sad day for agriculture but it will be saddest of all for the tenant farmer or the man who wants to become a tenant farmer.
§ 6.39 p.m.
§ Mr. Paul Hawkins (Norfolk, South-West)
I have to declare an interest, not because I am the owner of land, nor because I am a tenant, but because I have acted for owners and for tenants. I have been an arbitrator, I have been on the Lord Chancellor's panel of arbitrators, and I have appeared before agricultural land tribunals—so I suppose I have a middle interest and possibly I see both sides.
I congratulate the hon. Member for Durham (Mr. Hughes) on his moderate and sensible speech, which was, as always, full of knowledge of the countryside, which is so lacking in much that we hear from Labour Members.
I must admit that the hon. Member for Renfrewshire, West (Mr. Buchan) brings out the worst in me. He always accuses Opposition Members of being the landlord's men. I believe he still thinks that the landlord rides around on a black stallion, with a whip in his hands, driving the tenants off his holdings. Be that as it may, I have personally seen real hardship experienced in my own family, when a close relative of mine—an inheriting son of the third generation—was turned out of a farm. I do not believe that this necessarily makes a good case of changing the law, and I do not believe that the provisions should have been introduced in this way.
As I have already said, I believe that the overhaul of the Agricultural Holdings Act is long overdue. By introducing these clauses we shall make a real muddle of the Agricultural Holdings Acts. There is no doubt about that.
I cannot follow the clauses. I am a bit rusty about the Agricultural Holdings Acts but I am convinced from consultations with my partners and my rivals in business that there is no doubt that they feel that without considerable amendment some of these clauses will lead to confusion, which is the last possible thing we want to see in our agriculture.
I believe that hardship should be and still could be paid for in cash. There are certain occasions when the landlord is able to take land in hand and pays up to, I think, five years' rent. A similar arrangement—especially in view of how 97 widely the clauses are drafted at present—could have settled many hardship cases, without introducing this inheritance procedure. The Minister has shown a woeful weakness, because he did not want to introduce this legislation in this way at all; he said so. However, like Pilate, who knew what was the right thing to do, he gave way to the clamour behind him and at his side.
The National Farmers' Union is partly to blame. In my area the Norfolk NFU has not been able to consult its constituent branches. However, I attended my own branch, which was completely divided about what was the best thing to do. The members knew that some of their neighbours had sons who would like to inherit, and therefore they felt sympathetic towards them. However, they also knew that there were many young men and young managers—we must consider carefully the managers on some of the bigger farms—who were aching to get farms of their own.
The other day I received a letter from a young manager who made a major speech at the Oxford Farming Conference. He told me that he had given up all hope of ever getting a farm for himself. On balance, this measure will do more harm than good, although I appreciate the hardship cases and have had real experience of them.
The real trouble, and the nigger in the woodpile—if one is allowed to use that phrase, in view of the various discrimination Acts—is taxation, as was mentioned in the superb speech of my right hon. Friend the Member for Cambridgeshire (Mr. Pym). Taxation is driving the smaller estates either to sell or to take land in hand to get the benefit of the capital transfer tax. That means that less land becomes available to let. Moreover, there is very little land to let at present. I believe that the source will be dried up completely. Taxation is destroying agriculture in many ways that we know about, and is driving the ownership of agricultural land into the hands of the pension funds.
In my view the Crown, the Church and others who have been landlords for hundreds of years generally have a pretty good way of dealing with their tenants and some very sound agents. However, in my constituency there are several 98 villages which are totally owned by pension funds. We have an absentee landlord, absentee tenants in some cases, and an absentee agent living in London. I do not think that does any good at all. Together with taxation, these provisions will drive more and more land into the hands of the pension funds. Young men will be denied the chance to make a start and the right to farm on their own. I am absolutely convinced that these provisions will drive up rents.
Over the past months I have been negotiating with several tenants on estates. They have come prepared with this knowledge, knowing that because they will be given security for their sons, they will have to pay more by way of rent. There is no doubt about that.
As has already been mentioned, I cannot possibly agree that statutory smallholdings and the Minister's own land should be excluded from these causes, if we are to have them. How can any Member go to the tenant of a 100-acre farm and say "We have decided that your son will not inherit" and then go next door to the 1,000-acre farmer and say, "Your son can interit". I do not believe that can possibly be done. I do not believe it is right.
I was a member of a smallholdings committee for 21 years. The discussions do not take place at public hearings. Naturally the discussion as to whom one lets a smallholding to is a private matter. However, I know perfectly well that we always set our faces against saying in advance that we would let to the son of a tenant. Often we did so, but that does not mean to say that we always did so. I cannot believe that it is right to exclude the statutory smallholdings, of which there are 10,333 tenants—according to the last report, which goes up to 31st March 1974—and the 907 tenants belonging to the Minister himself. What is sauce for the goose is sauce for the gander. I believe that the Minister's statement is completely indefensible.
I ask the Minister who is to wind up the debate whether hardship also means hardship for the landlord's son, who may have been trained and waiting for a particular holding on his estate. If that is so we should know about it. Will the Minister make clear to his own Back-Benchers—not those who are present now 99 but those who were present during Question Time and appeared to be crying for his blood—that food will be forthcoming from our land only if it is properly paid for and the farmer can get a decent living from the land?
All our present taxes and regulations interfere with the production of food from our land, and it is that which we must constantly bear in mind when considering these new clauses.
§ 6.50 p.m.
§ Mr. Robert Boscawen (Wells)
I have no direct interest to declare in this matter, although as the son of a late landlord and farmer I have some familiarity with the problem that we are discussing. The problem of the right of a farming tenant's son to inherit is by no means new. There has long been a feeling in the part of the country which I represent and from which I come that, especially where farms are small and there are many tenanted farms, tenants' sons should have a right of appeal against notice to quit on the death of the father or on relinquishment of the tenancy by the father.
On the other hand, it is true that sons have, in the main, been given preferential treatment when a farm tenancy has come to an end. Indeed, in many cases it is unthinkable that a son should not continue in the tenancy of a farm which his father has farmed for many years.
Today, however, there are changes in the agricultural scene. Private landlords are becoming smaller, and corporation landlords, if one may so call them, are becoming larger and greater in number. Moreover, taxes on capital are making it increasingly likely that small private landlords—and perhaps even larger landlords—want to take more land into their own hands to farm it themselves.
In the main, I believe, there have been relatively few cases of hardship. The hon. Member for Durham (Mr. Hughes) cited one case of hardship, but I believe that for only one case of actual hardship there have probably been many more cases in which an individual has feared hardship and what might happen to him. We must bear that also in mind.
I hope that the passing of the Bill with these new proposals will not lead to an increase in that fear because of a danger that more tenants will be given notice to 100 quit. In my view, that could well happen. In the past, private landlords may have given the benefit of the doubt to sons of tenants, because of possible hardship, because of personal friendliness and the need to keep well in with tenants, and because of the need to maintain a harmonious atmosphere in the countryside, but now, if we have a statutory arrangement whereby a tenant can dispute a notice to quit, will landlords, especially corporate landlords, behave in the same way? In many cases, landlords may themselves wish to get hold of a tenancy if they can reasonably do so, as it will mean a substantial financial advantage to them, so is it not more likely that there will be more notices to quit under this legislation? I can well see that happening.
No doubt the agricultural land tribunal, or whatever body is finally given the task of deciding these cases, will have to keep that aspect of the matter in mind, but I fear that one result of our passing this measure will be not to reduce but to increase the fear of dispossession—or, rather, the fear among sons of not being allowed to inherit tenancies.
Next, I urge that the ALT, or whatever body is decided upon, should have a code of practice drawn up for it so that everyone in the industry will know the criteria for judging or defining the level of hardship and also the criteria for the required qualifications. That is most important, since we shall otherwise inject a new sense of uncertainty into the industry. A father must know what are the right qualifications for his son to continue in the farm. For example, must the son have had practical experience on the particular farm? That is one qualification that the Minister must clarify. Will it be tied to learning his trade on that farm?
I am sure that it will be much the best if a code of practice is drawn up after the Bill is passed, with a view to reducing the area of uncertainty that is bound to develop when a measure of this kind is enacted. Another area of uncertainty concerns the restraint that will be put on a tenant's son who inherits. Will he be required to continue to farm the property and not, after two or three years, to put it into the hands of a manager—which would be grossly unfair to a landlord who was himself wanting to put his own son 101 into the farm? What guarantee will the tribunal require that the son will farm the land properly for a considerable period ahead? That also must be decided.
I come next to the deterrent effect against the letting of farms. As time goes on and as taxation grows, especially as the capital transfer tax begins to bite, there will inevitably be a greater deterrent on the private landlord against letting farms if he can possibly avoid it. My hon. Friend the Member for Buckingham (Mr. Benyon), who spoke so well and with such knowledge, rightly pointed out—though, admittedly, it was difficult for him to point it out—that there must be some incentive for the landlord, especially the small landlord, to let some of his land. In my view, there should be a similar category of small working landlord, as there is for the small working farmer, with taxation advantages. Why should not the small working landlord have the advantages in capital transfer tax and other taxes which the working farmer may have advantage from?
The capital transfer tax has a direct bearing here. I understand that by passing the Bill as proposed we shall diminish some of the interest of a landlord in his own land and thereby diminish its value and reduce his likely assessment for capital transfer tax, but at the same time we shall conversely increase the tenant's liability for capital transfer tax. In a Written Answer given by a Treasury Minister on 2nd February 1976 it seems perfectly clear that if the tenant hasan interest in a tenancy which is assigned"—to him—it may constitute a transfer of value for capital transfer tax purposes."—[Official Report, 2nd February 1976; Vol. 904, c. 457.]It should be made clear to tenants who want their sons to inherit—and perhaps their grandsons, too—that in so doing they will increase the liability for capital transfer tax on the assignment of their tenancy. This could well be a substantial liability if the farm is of any size.
I believe that the landlord-tenant system is continuing to serve the interests of agriculture in this country. But unless these new proposals are given very careful consideration in Committee, unless the Government are prepared to listen to the advice given in this debate and amend some of the clauses of the Bill where 102 necessary, very great harm may be done to the whole system.
If, on the other hand, the Government are prepared to take the well-considered and experienced advice offered by my hon. Friends and some hon. Members opposite, I believe that these proposals may work to the advantage of the system as a whole. But something substantial must be done at the same time to encourage landlords to let their land to farming tenants and to counterbalance the disincentives to do so which will follow if the measure is passed as it is at present.
§ 7.1 p.m.
§ Mr. Michael Jopling (Westmorland)
My hon. Friend the Member for Wells (Mr. Boscawen) said that he hoped the Government would heed the advice which has been given during the course of this debate. This debate has provided the Government with a good deal of good advice. I was a little surprised at one stage to hear the hon. Member for Renfrewshire, West (Mr. Buchan) accuse us on these Benches of not speaking up for agriculture. He seems totally to have forgotten that this debate is taking place only because of requests made from this side of the House.
I declare my interest in that I am a tenant farmer of land of which I am a part owner, the remainder being in the ownership of my family. My family do not own any other land apart from that which I farm.
I should like to ask a question which my right hon. Friend the Member for Cambridgeshire (Mr. Pym) posed earlier, namely, where the Minister is and why he has not attended this debate. I should have thought that in view of the major rôle that he has played in the various discussions which have gone on behind the scenes in producing these new clauses, the least he could do would be to listen to part of this debate. I hope the Whip will tell him that we are dissatisfied with this situation.
§ The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Gavin Strang)
I feel that I must respond immediately to that observation. The hon. Member will, no doubt, appreciate that the day of the annual price review is enormously full for 103 any Minister of Agriculture. The hon. Gentleman will recognise also that the Opposition were given advance notice of the difficulties in which my right hon. Friend would find himself today. It is because of the commitments which automatically ensue from his statement this afternoon that my right hon. Friend has regrettably not been able to be with us.
§ Mr. Jopling
My right hon. Friend and I have been in the Chamber during the whole of this afternoon and neither of us has received such a notice. Of course, we understand that this is a full day for the right hon. Gentleman, but we would have expected him to be here for at least part of the time.
To move on, I think the House has noted that in these new clauses we are debating major changes in the law of property. My hon. and learned Friend the Member for Royal Tunbridge Wells (Mr. Mayhew) said that as a consequence of these clauses no longer can a landlord make a contract for a tenant to farm for his lifetime, which may be 50 years or more, because such a period would not be regarded as long enough. There may well be—indeed, I believe there is—certain justification for taking that view in some circumstances. But hon. Members, particularly on these Benches, have agreed that there is very little justification for introducing these proposals in this form. So many of my hon. Friends—particularly my hon. Friend the Member for Norfolk, South-West (Mr. Hawkins), with all his experience—have made the point that that there is need for a major review of the law on agricultural holdings. I hope that the Parliamentary Secretary will make a statement on the attitude of the Government to such a major review and major rethinking on agricultural holdings legislation. It has been kicking around in Whitehall for a long time. It is true to say that these proposals constitute a tinkering around with the law and that the time is long overdue to have a major reform.
I have asked myself what is the effect of these proposals on the landlord-tenant system. My right hon. Friend the Member for Cambridgeshire said that it is a marvellous system. There is no doubt that over the years it has done the industry and housewives very well indeed.
104 What we have to consider is whether these proposals will cause fewer farms to come on to the market in the future, and too late. Many hon. Members have said that many fewer farms are coming on to the market because of the taxation system. The effects of the capital transfer tax have been referred to by my hon. Friend the Member for Richmond, Yorks (Sir T. Kitson) and the hon. Member for Brecon and Radnor (Mr. Roderick), who accepted that the number of farms coming on to the market was already drying up. I think that he attributed this largely to the taxation system.
§ Mr. Jopling
The hon. Gentleman says he did not mention taxation. That may be true, but I think he will agree that the gist of his argument was that the taxation system has caused fewer farms to come on to the market.
§ Mr. Roderick
To get the record straight, I must emhpasise that I did not mention taxation. My argument was that farms were sold but that they were not coming on to the market as tenanted farms.
§ Mr. Jopling
I thought the hon. Member was implying that landlords were having to sell farms because of the ravages of taxation. If I read the wrong meaning into the hon. Gentleman's argument, I apologise and I take back what I said.
The question is, will these new measures accelerate the present trend? My hon. Friend the Member for Norfolk, South-West is a prominent member of the Central Association of Agricultural Valuers. Today I received a letter from the chairman of the Executive Committee of the CAAV saying:I do wish to point out to you that the proposed new legislation on succession right in farm tenancies will even further reduce the supply of vacant land for letting and this is the unanimous view of the Central Association of Agricultural Valuers.In view of that letter, I should think the Government would find it very hard to justify their statement—reported in column 443 of the Hansard Report of the Committee proceedings—that these measures will not cause the supply of farms to dry up. What landlord will be prepared to see farms pass out of his 105 control for a period of up to a century? The great danger is that these provisions will accelerate the present trend.
I had to smile when the right hon. and learned Gentleman the Secretary of State for Wales said that he hoped that these proposals would strengthen the landlord-tenant system. I notice that very few other Members in the House have said that they thought there was any chance of these proposals strengthening the landlord-tenant system. As for the general effect of these measures on agriculture, I believe that if the supply of farms to rent is allowed further to dry up, this must have an adverse effect on food production in this country. Therefore it must be the housewife who will suffer.
Our attitude in approaching these matters does not, as some hon. Members have suggested, come from a partisan view of being in favour of the landlord or of the tenant. We think only of what is in the interests of the agriculture industry as a whole and in the interests of the housewife. If farms to let become fewer there will be fewer tenants without a farming background coming into the industry. That would be a tragedy for the industry. Over the centuries many of the great agricultural improvers have been tenant farmers from outside the industry, from urban backgrounds. They made major contributions to the industry. There is a danger that new thoughts and new outside interests might be prevented from coming into the industry.
Many hon. Members have referred to the working of the Agricultural Land Tribunals. Several hon. Members have suggested that their work is unsatisfactory. Others, and I believe the hon. Member for Durham (Mr. Hughes) was one of them, suggested that most of the problems could be dealt with by Agricultural Land Tribunals. Other hon. Members made similar points, but I thought that on the Government side there was a blind view in favour of the operation of the tribunals. Only today I received from the Minister an answer to a Question which shows how extraordinarily few are the occasions on which the tribunals meet. Over the past five years the tribunals in Wales met only 21 times, in the South-West of England only 22 times and in the North-East 27 times. In some parts of the country 106 they are very good and well thought of but in other parts they are less well thought of.
I spoke at the weekend to two ex-presidents of the Association of Agricultural Valuers. They agreed that the agricultural land tribunals will be unsuitable vehicles to deal with some of the particularly delicate decisions that will have to be taken as a result of the proposals in the clauses. My hon. Friend the Member for Buckingham (Mr. Benyon) referred to that today, and it seems clear that something will have to be done to strengthen the tribunals. One way of doing that would be to enact the provisions of Schedule 9(13)(2) of the 1948 Act, enabling assessors to sit on the panel in all cases where a tribunal was considering the matters we are discussing today. I was surprised to see in another answer I received from the Minister today that over the past five years no chairman of an agricultural land tribunal has found it necessary to appoint assessors. That is a pity. We ought to insist that assessors be appointed in every case.
§ Mr. Jopling
Because at present the chairman is a lawyer, who is not closely involved in agricultural matters—unless he has made a particular study of it—is helped by two members, one from farming and one a landlord. They meet rarely and may be unused to sitting on a tribunal. It would strengthen the tribunals if we included on them a professional man who was used to the law and relating to agricultural holdings, appointed from the panel of the Royal Institution of Chartered Surveyors. This would produce better decisions.
§ Mr. John Morris
In the time I have been involved, directly or indirectly, in tribunals I have never heard of a complaint arising from the fact that a tribunal had failed to appoint such an assessor. Has the hon. Gentleman any evidence of any disquiet within one of the professions or has he heard an individual complainant say that justice has not been done?
§ Mr. Jopling
Perhaps the right hon. and learned Gentleman did not listen carefully. I said I had spoken to two ex-presidents of the Association of Agricultural Valuers who are professional 107 men of great standing. They both said that they felt that the agricultural land tribunals, in the form in which they had been working recently—that is, without assessors—were unsuitable bodies to deal with these highly delicate matters.
I turn to the arguments raised about what is and is not fair. A number of hon. Members, including my hon. Friend the Member for Richmond, Yorks, and the hon. Member for Durham spoke of the position of the landlord's son. That is something which we must discuss in depth in Committee because I believe that in certain cases we can argue that a landlord's son has at least as much right to work a farm as a tenant's son.
There are other difficulties, particularly transitional difficulties. I recently received a letter from a man who told me that he had bought a farm with a tenant on it. He said:The new clause stands to create personal hardship for me in that I may not be able to reside at, and farm, the property when the present tenant, who is elderly, retires or dies. Temporarily a non-resident, I bought the farm a few years ago with a view to returning from abroad and making it our family home when the present tenancy expires and the farm now represents the bulk of my savings.The position of a man in such an unfair situation must be examined.
My hon. Friend the Member for Wells made some helpful suggestions about how to deal with the small landlord. But there is also a danger of creating unfairness to others because of the proposals. Some time ago I met a number of managers of large agricultural estates who said that the proposals would take away from such managers the opportunity to farm on their own account.
The National Federation of Young Farmers' Clubs Association has told me:The opinion was therefore expressed by our Agricultural Committee that the major consideration for the average young agriculturist was that the maximum number of tenancies be available within a viable agricultural industry. It was important that these went to the best people by ability and effort, rather than by birthright. We fear that in protecting a few, for very good social reasons, the majority of young agriculturists will be denied the opportunity of contributing to this industry.That is a powerful message.
I am astonished that these proposals come from the Labour Party. It is 108 strange to hear that it is setting itself up as champion of commercial élitism and as promoters of economic dynasties. The Labour Party is proposing an extension of privilege. It is a facet of Karl Marx of which I had not been aware. It is significant that only the hon. Member for Durham was able to grasp that. All his hon. Friends ran away from the philosophic dilemma in which the Labour Party must find itself.
How has this situation arisen? We know what has happened. The Minister found himself confronted with some of his Left-wing Back Benchers who have used the policy which the NFU has had for the last seven or eight years to pursue their vendetta against landlords.
In Committee, the Minister told us that he did not want these proposals He made that clear as reported at column 441. We have in other ways seen how the Minister of Agriculture has been bulldozed by his left wing. We have seen it recently, as my right hon. Friend the Member for Cambridgeshire said, in the Labour Party's proposals to nationalise all agricultural land at a cost of £1,500 million. The Minister has given us the impression that he is against proposals of this kind. He may be against them, but he does not seem to do much about them. He seems unable to resist the steamroller which the left wing has driven into the front door of Whitehall Place.
Whilst in our view there is an argument for helping particularly hard cases in this area, we believe that these proposals go too far. These new clauses are in urgent need of amendment. We shall seek to amend them in Committee. At the moment we reserve our position—
§ Mr. Jopling
No. I must finish. We reserve our position for when we are back in power when these matters may need urgent review. In the meantime we shall—
§ Mr. Buchan
Before the hon. Gentleman sits down, surely one right hon. or hon. Member opposite should tell us whether the Opposition are for or against the principle in the proposal. Are they for the interests of the tenant farmer or 109 are they trying to defend the position of the landlord? Please tell us.
§ Mr. Jopling
The hon. Gentleman becomes more like a parrot the older he gets. I have made it clear—so did my right hon. Friend—that we believe there is an argument for help to be given in this area. I am repeating what I said half a minute ago. It may be that in the way in which these proposals are framed major hardships and situations will occur in the industry which will be wholly bad. We shall have to see whether we can amend these proposals in Committee in order to make them work. But we reserve our position. It may be that we shall have to change them in future, and we shall not hesitate to do so.
§ 7.23 p.m.
§ The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Gavin Strang)
I thought that my right hon. and learned Friend the Secretary of State for Wales had adequately explained that the Government had decided to introduce these new clauses to give the sons and other near relatives of tenant farmers a qualified right to succeed to farms. I was surprised that, notwithstanding that explanation, the right hon. Member for Cambridgeshire (Mr. Pym) sought to imply that there was something improper in the Government bringing forward this proposition at this time.
§ Mr. Strang
This is precisely how Parliament should legislate. Is the right hon. Gentleman aware that, on Second Reading, of the 19 Back Benchers who spoke no fewer than 10 referred to this issue although it was not in the Bill? I mention in passing that of those 10 Members, seven were in favour. One was a Welsh Nationalist, one was a Liberal, one was a Conservative, and the other four were Labour Members. Surely it was right and proper that the Government should respond to the representations of Back Benchers on both sides of the House, but particularly on this side.
110 The right hon. Gentleman suggested that, somehow, this proposal had been sprung on the industry and that there had not been adequate prior thought and consultation. The hon. Member for Westmorland (Mr. Jopling) said that this was something new. The Labour Party included this proposal in its 1973 programme—"Labour's Programme for Britain". Indeed, over a year ago, in reply to the hon. Member for Berwick-upon-Tweed (Mr. Beith), I said:I agree with the hon. Gentleman's observation about our experience of the legislation in Scotland. I assure him that the Government are giving serious consideration to making a change in the law in England and Wales. I am sure that he will recognise that this will be a fairly important development in the context of the legislation and we shall therefore have to consult all the other interests."—[Official Report, 20th Feb., 1975; Vol. 886, c. 1539–40.]In reply to my hon. Friend the Member for Lichfield and Tamworth (Mr. Grocott), I said:We have now started consultations with the representatives of the agricultural industry and the professional bodies concerned.—[Official Report, 7th May 1975; Vol. 891, c 456.]Therefore, it is preposterous for hon. Gentlemen to suggest that this proposal has been sprung on the industry without adequate notice of the Labour Party's thinking or of the Government's interest in the matter.
§ Mr. Pym
If all that consultation was going on, is it not fantastic that proper consultations were not concluded and the provisions included in the original Bill? That is the whole point. The Government obviously did not get their legislation in order. Are we to take it that the Government, after Second Reading of a Bill, are free to come along with an addendum half the length of the original Bill on a new point which did not form part of it? It is true that hon. Members raised this issue on Second Reading, but it was not in the Bill or before the House. That is the point that we are making.
§ Mr. Strang
I am sorry that the right hon. Gentleman has not followed this matter more closely. I made it clear on Second Reading—
§ Mr. Strang
—in winding up on Second Reading—that a major constraint 111 and consideration in the Government's thinking on the content of the Bill was enormous pressure on the parliamentary timetable. However, we rightly reconsidered this matter in response to representations by hon. Members.
Let me come very quickly—
§ Mr. Jopling rose—
§ Mr. Strang
I shall not give way. I must explain this matter. I have given way twice. Another debate is to follow on which there is to be a vote at 10 o'clock.
§ Mr. Jopling rose—
§ Mr. Strang
No, I shall not give way. I may give way a little later if the hon. Gentleman will give me an opportunity to get on.
I turn now to the issue that has been raised repeatedly by a number of hon. Members—the question of statutory smallholdings. Basically, there are two reasons why the Government have seen fit not to include in these new clauses an extension of this principle to smallholdings. First, it was envisaged that the clear intention of Parliament under the Agriculture Act 1970 was that smallholdings should be the gateway into farming, for example, for the able and experienced young man who wished to take up a farming career. Does anyone seriously deny that smallholdings can fulfil this rôle to a much greater degree than the average sized tenant farm?
My hon. Friend the Member for Durham (Mr. Hughes) disputed the extent to which it was happening in practice. That was a fair point. Smallholdings perform that rôle to a degree. Indeed, that was one of the essential purposes of statutory smallholdings. The Opposition seem to find some difficulty—this is a reflection of their political attitude—in discriminating between the powers which a private landlord should have and those which a democratically elected body should be able to exercise. This is an important principle. Statutory smallholdings are subject to democratic control. The committees which take the decisions on who should succeed are open to public scrutiny.
On the second point, hon. Gentlemen suggest—
§ Mr. Wiggin rose—
§ Mr. Strang
—that the Minister of Agriculture is adopting a different rule for himself. Nothing could be further from the truth. There is no exemption from this legislation for the Ministry's tenanted farms. The extension applies purely to statutory smallholdings.
In Committee—some hon. Gentlemen opposite have conveniently forgotten this—I said that last year we issued an instruction to the people who managed the Ministry's farms that sons and near relatives should obtain priority in these matters. In the past two years there have been 67 relettings of the Minister's tenanted farms. In eight of the relettings a near-relative applied for the holding, and in each case the near-relative obtained it.
§ Mr. Charles Morrison rose—
§ Mr. Strang
No, I shall not give way. I indicated that I may be able to give way later.
I am happy to reassure the hon. Member for Richmond, Yorks (Sir T. Kitson) that the Bill also applies to Ministry of Defence farms that are let on normal agricultural tenancies. It will not apply to farms let on a 364-day basis or on other short leases. Certain farms are let on that basis so that the Ministry of Defence can obtain early access should it so wish.
I turn to the issues which have been raised about the agricultural land tribunals. I accept that the work load of the tribunals in England and Wales is likely to increase substantially. As the hon. Member for Westmorland said, the tribunals are now underloaded. I believe that the additional work and experience will be welcomed.
I must tell the right hon. Member for Cambridgeshire that the tribunals are able, where appropriate, to go into private session. The right hon. Gentleman will probably agree that it is right and proper that private sessions are to be entered into only in limited circumstances. I accept that there may be delicate issues to be decided when it is appropriate to go into private session, but I suggest that the best way in which tenants and landlords can see that justice is being done is by matters being handled in public.
113 I say to the hon. and learned Member for Royal Tunbridge Wells (Mr. Mayhew) that it is not true that the tribunals have never been in the position of choosing between rival claimants. I accept that that situation will occur much more frequently. I am happy to consider any changes which might be made in making appointments to the tribunals. The Government are flexible about a whole host of matters which Opposition Members have raised. I am sure that we shall continue to have the amicable discussions which have taken place in Committee to date.
It is because the tribunals have been asked to arbitrate in relation to rival claimants and in cases where landlords in notice to quit cases have asked tribunals to agree that a prospective new tenant is preferable to the existing tenant—
§ Mr. Mayhew rose—
§ Mr. Strang
No; I have had to tell many hon. Members that I may be able to give way later. I have already given way three times.
§ Mr. Charles Morrison
On a point of order, Mr. Deputy Speaker. Is there any restriction on the time allowed for the debate?
§ Mr. Deputy Speaker (Mr. Oscar Murton)
The debate can continue until 10 o'clock. It is in the Minister's discretion whether he gives way.
§ Mr. Mayhew rose—
§ Mr. Strang
I shall give way on this occasion. It is fair to point out that there is another item of business to follow that cannot continue beyond 10 o'clock. The more time that is taken up with interventions the less time will be available for the following debate.
§ Mr. Mayhew
Does the Minister agree that there is a world of difference between the agricultural land tribunals having to decide issues such as he has mentioned and deciding between the rival claims of sons of the same tenant farmer?
§ Mr. Strang
I think that the hon. and learned Gentleman will find that that point is adequately dealt with in Com- 114 mittee. There will be a two-stage process. The tribunals will decide first who is the preferred claimant. Having decided who is the most appropriate successor, the second stage will be to decide whether he should have the statutory right to succeed.
An important matter that was well brought out by my hon. Friend the Member for Durham is that there is not an automatic right to succeed. The right is much more heavily qualified than in Scotland.
It is not unnatural that Opposition Members have complained that, notwithstanding the heavy qualifications, landlords have not been adequately protected. Some of my hon. Friends have expressed concern about some of the limitations. My hon. Friend the Member for Durham, in common with my hon. Friends the Members for Renfrewshire, West (Mr. Buchan) and Brecon and Radnor (Mr. Roderick), went into some detail and listed many areas in which the qualifications or limitations should be reconsidered. They mentioned health grounds, the two-generation argument and the type of education which qualifies as acting in lieu of the five years which have to be spent on the holding. They are all important parts of the scheme. No doubt we shall have many interesting debates upon such matters in Committee. I can assure the House that the Government have a flexible mind.
We believe it right that the law should give the near-relative a statutory right, but we want to achieve the right balance. We shall listen carefully to the views that are put forward in Committee before reaching a final decision about the nature of the statutory guidelines that the tribunals will have to act upon when they come to arbitrate.
I am afraid that time is running out. I assure Conservative Members that there is nothing I should like more than to continue for another half-hour. However, I must respect the rights of those who want to debate other matters, even if Conservative Members do not appreciate the need to do so.
§ Mr. James Wellbeloved (Erith and Crayford)
This is a vitally important debate, and my hon. Friend should not allow his concern about the business which 115 is to follow to deter him from adequately dealing with these essential matters. My right hon. Friend the Leader of the House can always arrange for the items of business which are to follow to be debated on a future occasion.
§ Mr. Strang
I am grateful to my hon. Friend for his help. I make it clear that that is positively the last intervention that I intend to allow.
A major issue, which I recognise Conservative Members have raised in good faith, is the suggestion that one effect of the clauses will be to dry up the supply of tenanted farms. I cannot agree that such an outcome will be significant.
We must first consider the possibility against the background of the changing structure of farming. The number of farming businesses, both tenanted and owner-occupied, has been declining rapidly in recent years for good economic reasons. We can expect the decline to continue. In 1970 there were 71.6 thousand wholly tenanted holdings. By 1974 the figure had fallen to 60.8 thousand. In 1970 there were 107.8 thousand wholly owned holdings. By 1974 the number had fallen to 97.7 thousand. Over that period the proportion of wholly-tenanted holdings has fallen gradually from 40 per cent. to 38.4 per cent. So, of course, there has been a continued decline not only in the absolute number of tenanted holdings but in the ratio of tenanted holdings to owner-occupied holdings.
It is right that this improvement in the structure of farming should continue, but an inevitable consequence of this improved efficiency is that there will be reduced opportunities for the would-be farmer to set up his own business. That is true whether he intends to be an owner-occupier or a tenant. The clauses will have the effect of enabling some farms to continue as tenanted when, under existing legislation, they would have been taken in hand by the landlord or sold with vacant possession.
Hon. Members have referred to the agricultural experience in Scotland. I think that they do an injustice to the views expressed there. The scheme there has been in operation for about eight years. The Department of Agriculture for Scotland follows these matters. My 116 hon. Friend the Member for Renfrewshire, West quoted the attitude of the Scottish NFU. My hon. Friend the Under-Secretary of State for Scotland believes that the evidence from Scotland over these eight years leads to the conclusion that the sort of fears which has been expressed tonight have not been substantiated. I think that is equally true of farm rents.
Hon. Members have to face the fact that, for a host of reasons, the price of farms which are tenanted has been declining, that the number of farms being relet each year has been declining even more sharply—
§ Mr. Strang
It cannot be accused of usually being biased in our favour, but if the hon. Gentleman will look at the survey conducted by the Country Landowners Association, he will see the reasons.
§ Mr. Strang
Taxation is no doubt an element in this issue. Why should it not be? There is a host of reasons why landlords have preferred not to relet tenanted farms. Hon. Members have to face the fact that they cannot have their cake and eat it. The right hon. Member for Cambridgeshire said forthrightly that he disagreed with the NFU on this matter. When I heard him say so, I thought "Good. For once we have got a clear-cut statement of the Opposition's policy on this." But that statement was completely different from the line taken by the hon. Member for Westmorland in Committee. I was nevertheless disappointed. What we got was a statement that this proposal was wrong and had to be opposed, followed by a statement that the Opposition would not vote against it, with a vague reference to a system that would enable the sons—and only the sons—of tenant farmers to succeed, and a further system to avoid social hardship.
There is only one way to avoid social hardship, and that is to change the law of the land and to see that, in circumstances where it is fair, the owner's relative has a statutory right to succeed. It is a contradiction for hon. Members opposite to 117 say how desirable it is for the son of a tenant farmer to follow and how horrible it is that in some circumstances such succession should not take place when it seems fair and reasonable that it should do so, but terribly wrong to introduce legislation to secure the purpose. The hon. Member for Wells (Mr. Boscawen) said that we all know of cases where it is unthinkable that the son should not follow, but my hon. Friends the Members for Brecon and Radnor and Durham can quote cases where the unthinkable has happened. The overall purpose of the legislation is to see that the unthinkable does not happen.
§ Mr. Pym
The hon. Gentleman speaks as though this legislation will end the hardship and unfairness. It will not. It will change it—but there will be cases of hardship and unfairness as a result of the legislation. It is a terrible mistake to think that by simply changing a system which, by and large, has worked well, albeit with cases of hardship, the Government are going to eliminate all hardship and unfairness. The hon. Gentleman should not expect too much from what the Government are proposing.
§ Mr. Strang
I reiterate that where there is greater hardship to the landlord, and he can demonstrate to that effect, the tribunal will not give the tenant's near relative the succession. If in Standing Committee hon. Members can suggest additional measures whereby we can reduce the social hardship we are talking about, we will happily consider their suggestions, and if they are practical incorporate them in the Bill. The Government bring forward this measure because we believe that it will promote better farming and because of the security which a tenant farmer and his son working on the holding will achieve as a result.
I come from tenant farmer stock myself, but I am not trying to succeed my father on his holding. Hon. Members must recognise that when a farmer gets to the age of 50 or 60 or 70 and his son works with him, the main incentive to keep that land in good heart and to invest is the fact that he wants his son to follow. If that becomes a statutory right rather than only a possibility, it will be a great incentive to the farmer to farm well and to invest in his holding.
118 But the second and more important reason is that this measure will reduce social hardship—and hon. Members have acknowledged that hardship cases do arise. I am not saying that they are a high proportion of cases, but there is a significant number of them, and under the present system such cases would continue to occur. By introducing these clauses we shall avoid such hardships in the future.
§ Sir Paul Bryan rose—
§ 7.48 p.m.
§ Sir Paul Bryan (Howden)
I wish to intervene briefly now, Mr. Deputy Speaker, for two reasons. First, the Minister failed to give way to my hon. Friends Secondly, I shall not be in Standing Committee upstairs to be able to tell him that his speech was a contempt of the House. The hon. Gentleman's speech was contemptuous because he failed to answer the two main questions we put to him. First, will this legislation lead to fewer farms to let, or will it not? Secondly, will it not lead to higher rents?
On the question of there being fewer farms to let, clearly the lesson of the rent Acts in private accommodation has not been learned by the Government. We would all agree that successive rent Acts have led to a situation of fewer and fewer houses to let, where people of modest means cannot find a house to rent. In other words, over-protection of the tenant leads to fewer and fewer tenants. What we have been complaining of tonight is that the over-protection of the tenant as laid down in these new clauses will lead to fewer tenants. Some protection is obviously required, but over-protection beyond the balance that the hon. Gentleman mentioned leads to fewer and fewer farms to let.
Secondly, this legislation is unrelated to the tax situation, and that makes it bad legislation. There are fewer farms to rent because of present capital taxes and fear of worse to come. This can lead to a situation in which the only landlords will be those not affected by capital taxation—in other words, the institutional 119 landlords. Because they are in business for the rent, they will go for a maximum rent. Those rents set the standard for all rents.
Lastly, we have had no reply to this straight question: is it fair that, with neighbouring farms in the same village, both of, say, 60 acres, one owned by a private landlord and the other owned by the local authority landlord, one tenant and his son should have a right to the inherited tenancy but not the other? Where is the fairness in that? I hope that the Parliamentary Secretary will take the trouble to answer that question in Committee.
§ Mr. Ben Ford (Bradford, North)
On a point of order, Mr. Deputy Speaker. Is there any way in which you can indicate to hon. Members opposite that they should adhere to gentlemen's agreements?
§ 7.52 p.m.
§ Mr. Jasper More (Ludlow)
I should not have detained the House but for the deplorable reply of the Parliamentary Secretary. I have to declare so many interests that it will take up a little time—first, as a landowner; secondly, as a farmer in partnership; thirdly, as a landlord; fourthly, as a lawyer; and, fifthly, as someone who served on agricultural tribunals for many years.
The Government simply have not done their homework on agriculture. They have thought of only one thing in bringing forward the new clauses, or in having them pushed on them by their Back Bench colleagues, and that is the interests of the farming families. What is needed in the interests of agriculture is thought for those who are not in farming but who want to be in farming. The essence of agriculture throughout our history has been the importance of bringing in new blood. There are countless agricultural colleges and institutes training young men in the skills of agriculture, but we are depriving those young men of the opportunity to come into farming in their own right.
The landlord and tenant system is under great strain, and the number of 120 tenancies coming on offer is being reduced. If legislation in the form suggested is passed, it is certain that the availability of private tenancies will dry up completely. Private landlords will do their best to be just to the sons and families of tenants, but increasingly institutions will own the land and I visualise the day when, if they let their land, they will be advertising for eunuchs or homosexuals or spinsters above the age of child-bearing. It makes a nonsense of agriculture if owners are to be given incentives of this sort.
In view of the importance of the cases which legislation of the kind suggested will throw up, it will not be enough that we should have the traditional type of tribunal consisting of a lawyer, a landowner selected by the CLA and a farmer selected by the NFU. That will be too casual. If lawyers are to be presidents of the tribunals, they must know the countryside and know about what they are adjudicating on. If landowners are to serve on the tribunals, they must have some legal knowledge, and the same applies to farmers. On one tribunal where I was the landlord's representative, I was received by my two colleagues with the news that we need not bother because possession had to be given to the landlord. In about half an hour, I persuaded them that their view was entirely wrong and we decided in favour of the tenant. If we are to have legislation of this kind—and this applies to existing legislation, too—we must have a centralised land tribunal composed of people with expertise in the law and in the land.
I should like to say a few words about the question of county council smallholdings with which I was involved for about 15 years before I became a Member. There is no justification for county council smallholdings unless they provide a farming ladder. The opportunities which they create to bring people into farming are very limited. There is an enormous waiting list of people in Shropshire who wish to get into farming, but the alarming thing is the lack of opportunity for those who wish to get out of county council smallholdings and take on something bigger. Legislation of this kind will make it impossible for them. The only sensible thing to do will be to wind up the whole county council smallholding enterprise and sell it, thus saving a lot of money for 121 the ratepayers. That would be a deplorable confession of failure, but it is bound to happen if legislation of this sort is passed.
There must be a general inquiry into the future of the landlord-tenant system in agriculture, and it must be combined with a consideration of agricultural taxation because that more than any other factor has created the present unsatisfactory position. I beg the Government, whatever pressures they may be under from their Back Benchers, to decide that the proper thing to do is to withdraw the legislation and to consider the whole matter, bringing into it the question of taxation—capital taxation on land, and income taxation on landlords.
§ 7.58 p.m.
§ Mr. Nicholas Winterton (Macclesfield)
I have given across the Chamber an unofficial assurance that I shall speak for only two minutes.
I regret that the Parliamentary Secretary replied to the debate in such an insensitive manner. We are discussing a very delicate subject. We all wish to improve the relationship between tenant and landowner. However, the Parliamentary Secretary's contribution was very unhelpful. He ended by talking about the purpose of the new clauses, namely, to remove social hardship. He should perhaps in addition have mentioned the importance of improving agricultural production. The clauses as drafted will not do that. In view of the drop in the value of the pound and the necessity for this country to import less and to grow 122 more, I should have thought that the hon. Gentleman would direct more of his comments to that matter. He utterly failed to do so.
The Parliamentary Secretary based virtually the whole of his argument on what the National Farmer's Union has advocated. Perhaps he will indicate to me, through you, Mr. Deputy Speaker, that he agrees that there is a large body of opinion among farmers and members of the NFU that there should be provision in the clauses for only one succession, not two, and that many members of the NFU feel that the question of county council smallholdings should be brought within the ambit of the legislation. As the new clauses stand, there is one rule for local authorities and another for the ordinary landowner, and that is not good enough, particularly as many county council smallholdings are bigger than some private holdings which will be affected by the legislation.
We shall try to improve the clauses in Committee. I assure the Parliamentary Secretary that he will have a battle on his hands in Committee. We want to improve the position of the agricultural industry. We do not want to spoil the relationship between landlord and tenant or to prevent private landowners from doing the wonderful work which they have done in the past to maintain the countryside as a heritage for the people of this country.
§ Question put and agreed to.
§ That this House takes note of the Government's intention to make fresh provision with regard to agricultural tenancies.