HC Deb 27 February 1990 vol 168 cc207-14 8.30 pm
Mr. Squire

I beg to move amendment No. 5, in page 4, leave out lines 16 and 17.

Mr. Deputy Speaker

With this it will be convenient to discuss amendment No. 6, in page 4, line 17, at end add if the trade to be carried out by the purchaser is materially different to that which is undertaken by the vendor".

Mr. Squire

Obviously I am marginally disappointed at the outcome of the Division, but I shall try again.

The debate on these amendments will be much more specific than the one that has just ended. I suppose that even I can admit that I am tackling a fairly obscure part of the Bill—its last sentence. It is appropriate that amendments Nos. 5 and 6 should be taken together, as you, Mr. Deputy Speaker, in your wisdom, have decided. The central point is why it is necessary to have the last sentence: Provided that such transfer or disposal of rights shall take effect without the consent in writing of the Council. I am advised that, in respect of ordinary trading, there is no similar right. If a person who has run a greengrocery shop for 10 years wishes to sell that shop to another greengrocer, he may do so without reference to anybody else. The parties may make the appropriate arrangements and agree a price, and everything will proceed. As hon. Members with local authority experience will know, the local authority has to be consulted only if there is to be a change of use. If, for example, a greengrocer is to be taken over by a bank or a building society, different procedures apply. But those procedures are restricted to cases in which there is a proposed change of use; the Shops Act 1950 makes no reference to anyone requiring further approval if there is to be no change of use. In those circumstances, why is this provision necessary? The change that I propose would have the effect of bringing the matter into line with the provisions of the Shops Act.

We do not know—certainly we do not know tonight—the nature of the stalls that will be run in Ilford. There is nothing about that in the Bill. We can go only by the reasonably brief exchanges that took place in Committee. According to those exchanges, Redbridge has confirmed that greengrocers and clothes stores would be limited in number, that car accessory sales would not be permitted—a matter that was mentioned by my hon. Friend the Member for Upminster (Sir N. Bonsor)—and that the sale of live animals, fish and raw fish was likely to be prohibited. However—this is an important ancillary point—the Bill contains nothing about those limitations.

But all this tells us nothing about the need for the final words in the Bill. I have stressed that this is a small amendment, but the form of the Bill should be as close as possible to the Shops Act, which recognises that there is no need for the council to be involved in the simple replacement of one business by another of identical type. Of course, it will be up to the House to decide the precise form of the legislation, but I see no need for the council to be involved. I say to my hon. Friend the Member for Ilford, South (Mr. Thorne), in advance of his explanation, that, at first sight, this seems to be to be the very reverse of the free-market approach which, on other occasions, he has been so willing to endorse. This provision is unnecessary. It retains a council involvement where none is needed. In those circumstances, I put forward the amendments.

Mr. Thorne

The purpose of the last sentence of the Bill is to make provision for good management. I am assured that, although it is not written into any statute for the benefit of Havering, that London borough chooses to confirm that the transfer of stores shall be by reference to it, and not automatically down a line of family members. That is only fair and reasonable. It will ensure good market management. It will ensure that traders who give good value for money—in other words, desirable people—are encouraged to trade at this market, and that people who are not likely to be good stallholders are discouraged.

The London borough of Redbridge has no wish to be unduly restrictive, but it wants to retain the right to approve people who wish to trade. It does not want some families of people to be in a position to monopolise stalls throughout east and south-east London. It believes that that would be a bad thing. For that reason, a modicum of control is necessary, but subject to that alone the London borough of Redbridge is most anxious that free and fair trading should be given every opportunity.

Miss Ann Widdecombe (Maidstone)

I am grateful for this opportunity to comment because if the Bill is passed and other markets follow suit the amendment would have a major effect on what would happen locally on my patch. I am also concerned about the general principle embodied in clause 6, which seems extremely odd, as my hon. Friend the Member for Hornchurch (Mr. Squire) pointed out.

The clause implies that there will be something unique about markets in future. If someone wishes to set up shop, he can do so in the knowledge that he can dispose of that shop—a greengrocer's or hairdresser's shop or whatever so long as there is no change of use. All is well—he can go ahead and sell the business. That will have quite an effect on his decision to set up in business in the first place and on how he assesses his competitiveness.

If the owner of a shop had to bear it in mind from the start that he could not necessarily dispose of his premises if he wished, he might not enter into the enterprise in the first place. Likewise, if someone who is considering setting up a market or becoming a part of a market finds that he may be refused permission to dispose of his enterprise unless the council agrees he may think twice. After all, he can have no possible knowledge of what the composition of the council will be or how it may view the matter in a few years' time. He cannot know what his competitive position will be and he cannot possibly make any sensible estimates for the future. He simply will not know whether it is worth becoming a part of a market or setting up a market or joining an enterprise or becoming financially involved. He will have no idea because he will not know whether he can dispose of the enterprise in the same way as he could if it were a shop. That is most peculiar. It seems that we are being asked to grant rights in relation to a market but then to place over it such an enormous unbusinesslike cloud that it will be extremely difficult for anyone to make a sensible decision about whether to become part of it.

If I proposed to set up an enterprise and I was told "Sorry, normal planning rules will not apply—the council can decide at whim, even on a political whim, to tell you that you cannot dispose of your asset as you wish," I should have to think twice about whether it would be worth engaging in such a business.

Mr. Squire

My hon. Friend makes a powerful case. Has she considered the possibility of there being a favourite son or daughter who the council may wish to take over the enterprise? As the Bill stands, that son or daughter would be able to take over by courtesy of the local authority.

Miss Widdecombe

Indeed, and I have not even come on to the question of abuse. I was merely considering the general principles involved and whether we should permit such an eccentric ruling to apply. My hon. Friend is perfectly right that the potential for abuse is vast. As I said, that could happen if the council changed its political complexion——

8.45 pm
Mr. Deputy Speaker

Order. I must draw it to the hon. Lady's attention that she is straying wide of the amendments before us.

Miss Widdecombe

I must be guided by your ruling, Mr. Deputy Speaker. As I understand it, the amendment would nullify the effect of line 17, which says that no transfer or disposal of right shall take effect without the consent in writing of the council. I am endeavouring to explore—with your permission, sir—whether leaving the council with such a wide discretion, completely separate from all regulations currently in force, could have a detrimental effect on the provisions of the rest of the Bill. If the Bill is an enabling Bill to allow such markets and such franchises, it seems peculiar that this mammoth restriction should be built into it. I seek your ruling, sir. Am I in order or am I as wide of the amendment as you implied?

Mr. Deputy Speaker

I suggest that the hon. Lady should not take her argument further than she has outlined.

Miss Widdecombe

Thank you, Mr. Deputy Speaker. Encouraged by your ruling, I should like to explore the argument advanced by my hon. Friend the Member for Hornchurch.

If the Bill remains unamended and the council has blanket powers in future, those powers could be abused. I suggest that the possibility of such abuse and the need to take due cognisance of it must be part of the commercial decision of a person engaging in an enterprise. Is it sensible that they should be tied down in this way? Might it not be more sensible to bring the Bill into line with the Shops Act, as my hon. Friend the Member for Hornchurch suggested.

I do not wish to trespass on your ruling, Mr. Deputy Speaker, but I suggest that political considerations could apply. Someone considering engaging in such an enterprise could reasonably ask, "Do I trust this council? It may be like my local council, which undergoes swings and is never in the control of one party for very long. Is it worth my engaging in this enterprise, given that that sort of council exists?" That is an important consideration.

It seems right for my hon. Friend the Member for Hornchurch to suggest that we look for a more suitable framework and see whether existing laws are adequate to allow any potential trader to operate and feel reasonably safe. That is the point of the amendment. It would bring us back to a change of use. If one is selling a greengrocer's shop to a greengrocer, that is fine. What one may not do is to sell a greengrocer's shop to somebody who wishes to sell pets or chemicals.

The amendment is eminently reasonable and I have heard no argument to negate my hon. Friend's point. This is a special Bill, which grants rights to one particular market, but it could have a chain effect. It is because of the potential chain effect that I am anxious that we get this right. I am not worried about this particular special market but I am worried about what will happen if the Bill becomes a basis for future franchises and future markets. I have heard nothing to suggest that my hon. Friend the Member for Hornchurch was not right that this is an eccentric clause—on top of the fact that the Bill takes one particular area and does something special for it.

People may be so entirely cavalier in deciding whether to engage in an enterprise that they do not care how they will dispose of it if it does not work or if their personal circumstances change, but I think that unlikely. In any event, an important principle is surely involved. We have an adequate law which has been respected and has stood the test of time and which, moreover, has been well understood by councils, local politicians amd traders alike. We should therefore try to stay within that framework as far as possible. I cannot see the slightest reason for this highly eccentric individual rule which will not apply to anything else. That, too, is an important consideration.

If somebody wishes to become involved in an enterprise of this sort, he will look around to see what is there, not only in terms of no markets but, more importantly, in terms of fixed trading. He will know that the fixed trader has an advantage that he does not have under these eccentric provisions. What effect will that have? My hon. Friend said that the amendment was a small one. I contend that even if the Bill is sensible and intends to enable what it sets out to enable—my hon. Friend may disagree with me on that but I am prepared to give the sponsors the benefit of the doubt—the last two lines of the clause make it as hard as possible for those who want to take advantage of it to do so. That seems a peculiar position.

The sponsors may say that they wanted to give the council wider powers, perhaps because markets are a little different from fixed traders—they can become a nuisance and the citizens may not react favourably to them—and if market forces do not apply, perhaps the council should have some say. The Bill is a way of giving the councils some say. In that case, surely it is sensible to spell out a set of limitations, perhaps more restrictive than the Shops Act 1950 but less restrictive than this eccentric blanket proposal. Had that been suggested, there would have been some merit in those two lines.

It is most extraordinary. The promoters of the Bill have not intervened once to explain why this eccentric measure——

Mr. Thorne

Is my hon. Friend waiting for an intervention?

Miss Widdecombe

I am delighted to take one if my hon. Friend is offering one.

Mr. Thorne

I have already addressed the House, but perhaps I could be allowed to intervene to answer the points that my hon. Friend has made. First, it is normal for a landlord to have a right to approve a change of tenant. That is a normal procedure and is therefore quite normal in this case. On the question of whether people should have an automatic right, the London borough of Havering and most other councils which control markets find it desirable to be able to stipulate whether they approve of the person to whom the market trader intends to pass on his stall. They do not wish to do so for reasons of nepotism or anything of that sort but simply to ensure that the trader who takes over is honest and reliable and will provide a reasonable service to the community. That is a perfectly reasonable thing for the public to expect. That is why the council would wish to be involved in that process. It would not wish to interfere unnecessarily but simply to make sure that standards are maintained.

Miss Widdecombe

I am most grateful to my hon. Friend for that elucidation. It introduces some logic into a position which hitherto seemed wholly illogical. I see the force of his argument that there must be some control over the nature of the tenant, his honesty, and so on, but once again—unless my hon. Friend can help me—I cannot relate that to the perfectly satisfactory position under the Shops Act whereby unless change of use is involved the transfer is more or less automatic, so there could be an unscrupulous tenant or a person of whom the council or landlord did not approve but that would not be the governing factor. The governing factors would be established planning and the tradition of the area and those shops.

If what my hon. Friend says is what he intended, I say again what I said just now. It would have been better if the limitations to which he referred had been spelt out. That would be better than a blanket measure which says that the council can refuse. It would not have to give reasons but would merely give or withhold consent. There is no guarantee whatever that the reasons would be honourable.

I have no reason to suppose that any council would engage in nepotism, but there is no safeguard against such abuse in the lines of the Bill to which I referred. The Bill gives an enormous remit. It simply says: without the consent in writing but says nothing about the conditions on which such consent should be based, the honesty, integrity or standards of the incoming tenant. There is not the remotest hint of that. It is just a blanket provision whereby councils may refuse, so a council could refuse for a whole host of bad reasons as well as a whole host of good reasons.

Although I should quickly be called to order if I dared to do so—I shall not do so—one could draw many parallels with other Acts where we define carefully what a council may or may not do, including the Shops Act. It is faintly surprising that on this occasion we have chosen to include a blanket provision. It has been explained, but it is still completely unqualified.

Mr. Tim Boswell (Daventry)

I am following my hon. Friend's argument with interest. Does she accept that the circumstances of a market are slightly different from those of a row of shops? One knows that simply from practical experience. Market traders are close up against one another. They can move from stall to stall and, indeed, may be seen doing so. Property can, as it were, move sideways. In contrast, shops are normally separate lock-up establishments in a defined space and much easier to defend. I fully understand the arguments of my hon. Friend the Member for Ilford, South (Mr. Thorne), which bear on the issue of security. There may be some constitutional points in the argument which my hon. Friend the Member for Maidstone (Miss Widdecombe) advances. Nevertheless, they do not deal with the essential issue of market security.

Miss Widdecombe

I agree that reasons of security and the character of the landlord, which my hon. Friend the Member for Ilford, South put forward, are perfectly good reasons, but I return to the point that I was making—that none of those reasons has been defined. If an exhaustive list of reasons is not to be given—I accept that that would be impractical—the promoters could have attempted some limitation on the blanket proposal that a council should be able to withhold or give consent without any specified limitations.

My hon. Friend the Member for Daventry (Mr. Boswell) is right that there is a difference between a market and a row of shops. We can all immediately see the difference. It is therefore extraordinary that we should give protection to owners of shops, which are permanently in situ if something goes wrong but take less stringent action for markets, which are more fluid.

In conclusion—you will be relieved to hear me say that, Mr. Deputy Speaker—this is too much of a blanket proposal. If the Bill is successful, its effects will be felt not just in the individual case for which we are so eccentrically legislating, but throughout the country.

Mr. Harry Barnes

Are they such blanket provisions as the hon. Lady suggests? The amendment relates to the removal of a veto exercised by a council. It is not a matter of grace and favour in the hands of the council so that it can positively take action in an area, although I grant that if the veto were used often enough it could operate in such a way.

Miss Widdecombe

No, indeed. I was saying that a trader has to consider at the beginning the commercial viability of a project over which, according to the Bill, the council is to have unfettered rights of veto—I repeat, simply of veto. A trader may wish to dispose of his interest in the enterprise, but a veto exists. If a trader is disposing of a shop, he knows the terms under which a veto can be applied. He knows, for example, that if there is to be no change of use he can sell his bakery shop to another baker and all is well. We are not giving the same protection to a market trader, so anyone engaging in such an enterprise will be subject to the whims, the political inclinations, the nepotisms and all the other possible abuses or simply the sheer incompetencies of the council.

Mr. Barnes

Is the hon. Lady saying that the sponsors should have produced a set of conditions or that the rest of us should have been responsible for tabling amendments to set out a list of conditions which would have been stronger than those outlined in amendment No. 6? Presumably the hon. Lady feels that that amendment would improve the position, but that it would not be so good as acceptance of amendment No. 5.

9 pm

Miss Widdecombe

Amendment No. 6 absolutely and ideally takes care of what I am saying. Having given the right of veto to a council, which is perfectly proper—I do not wish to prevent a council having the right of veto—it states the grounds on which the veto may be exercised. Those grounds are exactly the same as those set out in the Shops Act. When a trader started in an enterprise, he would know from the start that so long as there was no change of use and he continued the operations previously undertaken and then sold the enterprise to someone who would carry on the same trade, everything would be all right. Under the Bill as it stands, the trader does not even have that consolation. Indeed, he has no consolation at all.

Even if that state of affairs does not prey on the minds of traders, as I believe that it will, it opens up every last possibility for abuse. Under amendment No. 5, the council can give a veto under certain stipulated conditions which seem to be logical and in the public interest. I should certainly wish them to be applied if this situation ever arose in my constituency. That is reasonable. What I do not think is reasonable is the complete blanket proposal. I do not understand why the sponsors have not accepted the amendment. It seems such a logical thing to do. Not only would it save much argument and time, but it would produce a better Bill at the end of it all.

I was in the middle of summarising my case when the hon. Member for Derbyshire, North-East (Mr. Barnes) intervened. If the effects of the Bill are repeated elsewhere, two sets of trading rights will be created—those applying to a person with a permanent establishment and those applying to a person who operates in a market. If the trading rights are to be established in such a way that they militate against market traders, who will have no guarantee of commercial stability and when they take on an asset will not know whether they will be able to dispose of it, and if we put into the hands of councils certain powers that they do not have in any other area—the power to exercise a blanket veto without any reference in law as to the considerations on which the veto should be based and with nothing on the face of the Bill about what criteria should guide their decisions and inform their judgments—the possibilities for abuse are so obvious that they hardly need spelling out.

Those abuses need not be political or nepotistic. A council might simply have taken a financial decision which suddenly makes it inopportune to have a viable market where previously there was one. The council might then decide to proceed by way of piecemeal planning destruction. That is a perfectly reasonable possibility. Unless there is something to limit the right of veto and to spell out the factors on which a council should base its decisions, the provisions seem much too dangerous.

I do not have a view on the area affected because it does not fall within my responsibility to have such a view, but I certainly have a view as to what might be repeated in my own constituency, where there is an old established market and in constituencies such as mine with totally unreliable councils which swing from one party to another and from one policy to another. This is an extremely dangerous and nasty little blanket power, and it is completely unnecessary. The Bill could have been amended a long time ago if the sponsors had listened to reason. I commend my hon. Friend's amendment to the House.

Madam Deputy Speaker (Miss Betty Boothroyd)

The Question is that the amendment be made——

Mr. Squire


Madam Deputy Speaker

Is the hon. Member for Hornchurch (Mr. Squire) seeking the Floor?

Mr. Squire

I do so simply as the mover of the amendment, Madam Deputy Speaker—and to say how nice it is to see you. I have been moved by the classic demolition of the sentence in question by my hon. Friend the Member for Maidstone (Miss Widdecombe). You were right, Madam Deputy Speaker—my speech was pallid in comparison with that of my hon. Friend. I concede that there is a major principle at stake here and we should divide on it.

Question put, That the amendment be made:—

The House divided: Ayes, 30. Noes 65.

Division No. 99] [9.05 pm
Banks, Tony (Newham NW) Neubert, Michael
Barron, Kevin O'Brien, William
Cox, Tom Pike, Peter L.
Dalyell, Tam Powell, Ray (Ogmore)
Dixon, Don Skinner, Dennis
Duffy, A. E. P. Smith, C. (Isl'ton & F'bury)
Dunnachie, Jimmy Spearing, Nigel
Durant, Tony Squire, Robin
Gill, Christopher Taylor, Mrs Ann (Dewsbury)
Godman, Dr Norman A. Watson, Mike (Glasgow, C)
Golding, Mrs Llin Widdecombe, Ann
Haynes, Frank Wigley, Dafydd
Hinchliffe, David Wise, Mrs Audrey
Hughes, John (Coventry NE)
Jones, Barry (Alyn & Deeside) Tellers for the Ayes:
Lofthouse, Geoffrey Mr. Harry Barnes and Mr. Bob Cryer.
Meale, Alan
Alexander, Richard King, Roger (B'ham N'thfield)
Allason, Rupert Kirkhope, Timothy
Arbuthnot, James Kirkwood, Archy
Bendall, Vivian Knapman, Roger
Bennett, Nicholas (Pembroke) Knight, Greg (Derby North)
Bevan, David Gilroy Lightbown, David
Browne, John (Winchester) Lilley, Peter
Budgen, Nicholas Maclean, David
Burns, Simon Mans, Keith
Campbell, Menzies (Fife NE) Miller, Sir Hal
Carlisle, Kenneth (Lincoln) Mitchell, Andrew (Gedling)
Chapman, Sydney Monro, Sir Hector
Coombs, Simon (Swindon) Patnick, Irvine
Currie, Mrs Edwina Pawsey, James
Dorrell, Stephen Riddick, Graham
Emery, Sir Peter Ryder, Richard
Evennett, David Shaw, David (Dover)
Fenner, Dame Peggy Shaw, Sir Michael (Scarb')
Fookes, Dame Janet Shephard, Mrs G. (Norfolk SW)
Fry, Peter Shepherd, Colin (Hereford)
Gow, Ian Steel, Rt Hon Sir David
Green way, Harry (Ealing N) Stewart, Allan (Eastwood)
Hague, William Summerson, Hugo
Hargreaves, Ken (Hyndburn) Taylor, John M (Solihull)
Harris, David Thorne, Neil
Hayes, Jerry Thurnham, Peter
Heathcoat-Amory, David Tredinnick, David
Irvine, Michael Waddington, Rt Hon David
Jack, Michael Wallace, James
Janman, Tim Wheeler, Sir John
Johnston, Sir Russell
Jones, Gwilym (Cardiff N) Tellers for the Noes:
Jones, Robert B (Herts W) Mr. Tim Boswell and Mr. David Amess.
Jopling, Rt Hon Michael
Kilfedder, James

Question accordingly negatived.

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