ACQUISITION OF LAND (Hansard, 26 April 1978)

§ Mr. Steen
I beg to move, That the clause be read a Second time.
In view of the lateness of the hour, Mr. Deputy Speaker, I shall move the new clause formally.

§ Mr. Eyre
The subject covered by the new clause is of enormous importance to inner areas. However, I shall speak briefly in its support.
Vast areas of unused land in inner city areas are owned by local authorities. It is imperative that as much as possible of that land should be brought rapidly into productive use. It is particularly important that this land should be used mainly for small and medium-sized businesses.
If such areas are to be developed with the help of private enterprise without long delays, the local authorities in the inner city areas should be prepared to dispose of the land at market value, which may be below the cost of acquisition.
Often this land is held at book values which far exceed its true value. The value that it truly commands in the open market must be found so that a steady flow of disposals can take place and steady development can be speeded up.
In addition, local authorities and statutory undertakers, which also own great areas of inner city land, should be required to make such disposals upon request by a developer unless they have a specific intention of utilising the land themselves within a reasonable time. Local authorities and statutory undertakers should be put under an obligation to develop any land that they choose to 1550 hold within a maximum period of three years.
Special difficulty arises under the Community Land Act. By reason of the general disposal consent issued by the Secretary of State under Section 42 of that Act, local authorities are not authorised to make disposals of land for development, except for housing, by leases of more than 99 years' duration. Also, there are limitations upon the area of land which may be so disposed of, down to as small an area as half a hectare. The specific consent of the Secretary of State for the Environment is required for disposals under longer leases or in respect of larger areas.
The financial institutions have made known their strong preference for longer leases as a basis for financing schemes for commercial and industrial development. The institutions and many who wish to carry on development believe that developers are being discouraged from seeking financial assistance for possible development schemes on this account and because the developers doubt the willingness of some local authorities to seek exemptions from the 99-year rule. The view of the institutions is that the general disposals consent should be amended to make longer leases, that is, 125 years, the rule rather than the exception. This would encourage developers to come forward with schemes which at present are stillborn.
One of the first requirements of dealing with inner area problems is that we should speed up, simplify and cheapen the disposal of land. I hope that the Minister will give very serious consideration to the terms set out in the new clause.

§ Mr. Guy Barnett
I am afraid that I shall have to ask the House to reject the new clause if the hon. Member for Liverpool, Wavertree (Mr. Steen) is unwilling to withdraw it. I shall set out my reasons for that as clearly as I can.
The main reason is that which has been given by the hon. Member for Birmingham, Hall Green (Mr. Eyre), namely, that, in general terms, the new clause runs counter to the Government's disposal policy. Indeed, as the hon. Member correctly states, the disposal policy allows the disposal of land for freehold for residential purposes. Also—the hon. Member did not mention this—we have given 1551 a general disposal consent to local authorities of sites not exceeding 0.5 of a hectare in area or £25,000 in value, because pieces of land of that size have no significance within the terms of the community land scheme. The purpose of that scheme, as the House well knows, is to ensure that the community shares in future the increases in the value of land.
The issue with which the new clause is concerned is a good deal more complex than I think the hon. Member for Hall Green made it sound. It concerns more issues than merely the book value, which he described, although that is a real problem concerning land. There is the further problem of proper servicing of the land to make it available and attractive to developers. This is something about which my right hon. Friend and I are concerned in relation to the partnership areas. Indeed, as I think the House well knows, my right hon. Friend has approached the statutory undertakers to ask them to review their land holdings to see the degree to which they can make land available for redevelopment in inner city areas.
12 midnight
The hon. Gentleman referred to the issue of the 99-year lease. He is correct in saying that there is pressure for longer leases, especially from some of the funding institutions. Within the Department we have always operated as flexible a policy as we can to ensure that the best deal is available to the local authority and, therefore, ultimately to the community. If there has been a good case—undoubtedly a good case from the community's angle—for a 125 year lease, we have been prepared to grant it. In general, we must recognise that it is proper for the community to ensure that so far as is possible the community itself benefits from future increases in the value of land. That is why we are opposed, as regards industrial and commercial development, to large-scale freehold disposal or long-term leases that may operate to the disadvantage of the community as a whole.