HC Deb 12 May 1999 vol 331 cc387-96

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Clelland.]

8.38 pm
Miss Anne McIntosh (Vale of York)

I am delighted to have this debate on compensation to be paid on the compulsory acquisition of land. I am sure that the House recognises the growing demand for reform of our system of compulsory purchase and compensation. It is an extremely complicated area of law and, currently, 42 separate Acts of Parliament apply. The system is complex, slow, expensive and inefficient. It is grossly unfair and heavily biased in favour of national companies, such as the National Grid Company, and other powerful bodies. Might is not always right, so I welcome the Government's fundamental review of laws and procedures relating to compulsory purchase and compensation, and the interim report.

I should also like to take this opportunity to ask that the Electricity Act 1989 be revised and amended. My particular reason for asking for this debate is the overhead power lines that transmit electricity across the Vale of York and elsewhere in North Yorkshire. A review of both compensation and compulsory purchase and the Electricity Act would help to restore the balance by tilting it more in favour of individual landowners' rights and property interests. It is generally recognised that the Englishman's home is his castle, so how many of us would welcome agents of the National Grid Company entering our property and trampling over our land, often without sufficient warning?

Problems arise at various stages. There will be blight both before the pylon is in place and following construction. There will be a substantial drop in the value of the properties and in the enjoyment of those who live there, as their view will be impaired and there will be pollution from the lines.

The first problem is the serious lack of agreement and the inability of landowners and the National Grid to negotiate about the dent in property values. There is a discrepancy of hundreds of thousands of pounds. That problem must be addressed, procedures must be adopted and compensation levels for pylons must be put on the same basis as for road construction and flood defences.

The second problem is referred to in paragraph 8.5.1 of the interim report commissioned in the Government review. It states: A major source of grievance among property owners is the right of private companies to use compulsory powers to acquire property, paying a form of statutory compensation which is commonly perceived as benefiting shareholders at the expense of landowners. Aberdeen university is conducting research into wayleaves. Chapter 9 of the interim report examines the programme of further work, but, surprisingly, does not mention any review of wayleaves once Aberdeen university completes its research. Why not?

The purpose of this debate is to put before the House and the Minister the real concerns that my constituents have expressed about these problems. Tempers are running high in the Vale of York, and there was nearly an assault prior to Christmas last year because of the failure to reach an agreement. Little notice is given and scant regard is shown for property and for landowners' rights. I shall give some examples of unsympathetic, hostile and offensive behaviour, particularly by the National Grid or its contractors.

Before the wayleave hearings, the National Grid sought to reach agreement with the landowners by offering easements for the overhead line. By offering an easement, as opposed to a wayleave, the National Grid offered a capital payment to reflect the depreciation in the value of the properties, particularly the residential properties, that would be affected by the proximity of the proposed electricity line. Any landowner who did not sign up to the easements before the commencement of the wayleave hearings had the offer withdrawn, with the threat that, once the wayleave hearings were completed and the National Grid had obtained consent for the line, the landowner would receive only an annual wayleave payment that would not reflect the depreciation in capital values suffered. That is a clear abuse of compulsory purchase powers.

I shall refer briefly to correspondence that I have received from my constituents about this matter. One letter referred to a wayleave pre-hearing meeting at Northallerton in December last year. The inspector was asked about the width of the wayleave required over a particular constituent's land. He was unsure of the answer and referred the question to the National Grid. It declined to state the required width of the wayleave to the inspector, so my constituent's question went unanswered. The National Grid then refused to state the width of the wayleave required; that places my constituent in an unacceptable position, as he is uncertain about the amount of land that will be taken out of production. My constituent believes that withholding such information is an infringement of his rights, and I share that view.

Another constituent asked that farmers be given reasonable notice—six months' notice—before the commencement of construction in order to assist them in going about their business. That is a perfectly reasonable request, particularly when such a large project is in hand. I ask the Minister why the rights of farmers are not respected in that regard.

I was struck most by a letter that I received from the Minister for Energy and Industry in February this year, in which he said: I am unable to intervene as questions of compensation for the presence of an electric line are not the responsibility of the Secretary of State, who has no powers under Schedule 4 to the Electricity Act 1989 to prescribe conditions in any wayleaves he may grant. Compensation falls to be settled by agreement between the parties or, failing agreement, by the Lands Tribunal at the request of either party. That is a totally unacceptable response on the part of the Government, and this is an opportunity for the Minister to confirm to the House that the Government will consider that Act and give the Secretary of State the necessary powers.

Another constituent said that the National Grid have had nine years to plan their proposed development. How do they expect a farmer to adjust his farming activities (cropping and grazing programme) to accommodate a major development with only 28 days' notice?" On another occasion, an adviser to that landowner wrote: I appreciate that the Secretary of State believes he does not have the power under Schedule 4 to the Electricity Act 1989 to prescribe financial conditions in any wayleave he may grant. He continued: The Minister must look again at the Electricity Act 1989. The National Grid Company must look again at its policy for future electric lines. I refer in particular to one constituent, Mrs. Hird, who has three young children, whom she has now discovered are on the European at-risk register on possible cancers forming because the children will be brought up under an overhead power line. Because the pylon does not pass across her land, she is not eligible for compensation. She has made a very modest request that the pylon should be moved a further 20 m away from her house. As I speak today, the National Grid has not seen fit to agree to that.

Another problem is that, where overhead lines pass within 150 m of a residential property, the National Grid does not require a wayleave or easement from the individual property owner. A recent complaint is that the National Grid or the contractors have deliberately entered land when the occupier is absent.

There is clearly blight on all those properties because of the associated noise and perceived health risk of a property being close to a high-voltage electricity line. Under a highways scheme, property owners would be eligible for generous compensation, but apparently compensation for such property owners is excluded under the Electricity Act.

Other companies operating in the private sector are known to make more generous payments. For example, payments received as annual rental for mobile phone masts over 15 m high, but substantially lower than the pylons in question, are only a little less than the one-off payment offered by the National Grid in respect of the giant pylons that it seeks to build.

I urge the Minister to go further in the direction that his Government are taking. They commissioned a publication produced by the Property Industry Group, called "Blight, Might and Rights". That group includes the Country Landowners Association, the National Farmers Union, the Agricultural Law Association, the Federation of Small Businesses and many others. It said: National projects requiring compulsory purchase powers take years to deliver, and leave a trail of disaffected claimants in their wake, and fail to address blight. It claimed: Compulsory Purchase Law and procedure should be updated to ensure just and equitable treatment for persons affected, at the same time as ensuring those who need property to modernise and improve the National Infrastructure"— such as the grid—

"are able to proceed more quickly than at present." The group's most alarming conclusion was, perhaps, that privatised utilities have inherited the power of the State to compel people to part with or grant rights in land and property for their own benefit. There has been no amendment of the legislation to reflect their commercial interest. This is an opportunity for the Government, as part of their review, to amend and update that legislation. "Blight, Might and Rights" points, in particular, at procedures, costs, the blight that I have mentioned, negotiations and a code of practice.

I turn briefly to flood defences, which raise many concerns and issues similar to those raised by pylons. Coastal property owners and farmers who are faced with the potential of managed retreat are disappointed that the Ministry of Agriculture, Fisheries and Food is still unwilling to acknowledge financial loss, even though the Select Committee on Agriculture strongly recommended a compensation mechanism.

The word "compensation" appears not to be accepted by MAFF, whereas the word "benefit" is. That is the benefit to the country as a result of farmers giving up their land for sustainable flood defences. It is only fair that compensation should be paid in such circumstances, as it is for the building of roads, airports and the like. The Government have clearly recognised that there is an acute problem with laws and procedures relating to the compulsory acquisition of land and compensation.

I am grateful for this opportunity to raise these concerns on behalf of my constituents. I make a plea to the Minister, the Government and the House to put all forms of compulsory purchase of land on an equal footing, and to make compensation for overhead power lines, flood defences and road construction equally generous and based on the same principles in every case.

I regret that, with regard to overhead line transmissions and the construction of pylons, the National Grid has clearly and often been seen to act in an arrogant, hostile and insensitive manner, at times causing great offence and concern to landowners who live in the Vale of York. Courtesy and advance notice would be appreciated—particularly more than seven days and possibly as much as six months before pylons are constructed. That is not too great a request.

The Minister could make the process more democratic. As I said, it is quite wrong that he is unable to intervene on questions of compensation. Clearly, schedule 4 to the Electricity Act should be amended so that parties do not resort to an expensive land tribunal in the event of disagreement. At what stage is the review, and which specific action and reforms are proposed?

This debate is very timely; it gives the Minister an opportunity to present an update. There is clearly a need for reform, which I think both main parties in the House accept. The Government must proceed and inform the House of such reform. I hope that the Minister will give an undertaking that the reform will be in place before the pylons have been constructed in the Vale of York.

8.52 pm
The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Mr. Nick Raynsford)

I congratulate the hon. Member for Vale of York (Miss McIntosh) on securing this debate. The House will know that the Government place a high priority on the need to modernise our planning system. As part of that process, we are undertaking a thorough review of compulsory purchase—the most thorough review for a generation—to which the hon. Lady referred.

The hon. Lady made a number of specific points on compulsory purchase orders and wayleaves in her constituency, which I shall address in turn, although I should point out that responsibility for those matters under the Electricity Act 1989 lies, as she knows—we have debated this previously—with my right hon. Friend the Secretary of State for Trade and Industry. Indeed, responsibility for coastal protection and flood defences lies with my right hon. Friend the Minister of Agriculture, Fisheries and Food. The hon. Lady will understand that I cannot comment on the merits of individual cases, but she and the House may find it helpful if, before I address her specific points, I set out briefly the context in which they should be considered.

It is always agreeable when one secures a consensus. We certainly have a very broad consensus on compulsory purchase and compensation laws: everyone, it seems, is critical of them. The trouble is that the consensus does not extend to agreeing what precisely we should do to make such laws better. Indeed, opinions on the matter are extremely polarised. There are those who maintain that the expropriation of land is draconian; that too many bodies have compulsory purchase powers; that compensation is inadequate; and that acquiring authorities can be heavy handed and inconsiderate in their deployment of such powers. I have some sympathy with those people.

Miss McIntosh

Does the Minister agree that part of the problem, as he has explained, is that three different Ministries are involved and that there is no co-ordination between them? A landowner in my constituency is attempting to negotiate with the National Grid Company, but he is faced not just with the might of a large company, but with three Departments which each pass responsibility to another.

Mr. Raynsford

If the hon. Lady will bear with me, I shall highlight specifically the issues that are relevant, especially to electricity pylons and cables, which are often very different from those that apply to compulsory purchase in an urban context. She will equally appreciate that Departments that have a particular interest in a subject—for example, the Ministry of Agriculture, Fisheries and Food has a particular interest in coastal and flood defences—should be involved. However, I shall return to those points.

I was explaining that some people regard the whole compulsory purchase procedure as draconian. Others view compulsory purchase as an essential tool for the achievement of publicly beneficial work, such as the regeneration of run-down urban areas. They argue that compensation often rewards land or property owners whose neglect has contributed to the very dereliction that the regeneration seeks to reverse, and that the achievement of our target of 60 per cent. of new homes to be built on recycled land can be achieved only if there is wider use of compulsory purchase order-backed land assembly in appropriate development sites in cities. I have some sympathy with those views, too.

Having set out those two viewpoints, I should say that there is a third viewpoint—that of those who, putting to one side the questions of the adequacy of the powers or the quantum of compensation, point to the mind-boggling complexity of the law. There are hundreds—probably thousands—tutory references to compulsory purchase and compensation, spread through dozens of statutes going back as far as 1845. Add to that the accretion of 150 years of case law, Mr. Deputy Speaker, and you have a behemoth of a system.

The House will readily appreciate that when the lawyers complain that the law is too complex, it is almost certainly too complex, and it is time for action to be taken to tackle that. That is what we are seeking to do. The Government are aware of the problems, and our overriding objective is to create a simplified, consolidated and codified law, which is efficient, effective and fairer all round. That is what we are trying to achieve.

In June 1998, we established a fundamental review of the laws and procedures relating to compulsory purchase and compensation. Because the system is so convoluted and the opinions of the protagonists are so divided, we constituted an advisory group to help us undertake that task. I place on the record my gratitude for the work that that distinguished group of lawyers, academics, planners, surveyors, landowners, local authority officers and representatives of the major developers has undertaken so far.

The interim report, presented by that group in December, has been widely welcomed and praised for the thoroughness with which it has approached the issues and for the balance of its conclusions. I am confident that the group's continuing work will deliver the results that we wish.

My confidence that the review is proceeding along the right track was boosted following the first ever national symposium on compulsory purchase and compensation, which the Department of the Environment, Transport and the Regions, in partnership with the Royal Institution of Chartered Surveyors and the Royal Town Planning Institute, sponsored in February 1999. Discussion at the symposium—was privileged to have the opportunity of attending and speaking at—spondence since then confirms that we are addressing the key issues, and that we are doing so pragmatically.

Now is not the time for a detailed critique of the group's report nor of its work programme for the months to come, but two linked findings are of particular importance. The first is that, allowing for some exceptions in the detail, the current compulsory purchase order framework is essentially sound and does not need reinventing in its entirety. The second is that the system is not always operated "efficiently, effectively or fairly"—uence, the group believes, of the infrequency with which the powers have been used in recent years. To put matters right, the group recommended—been quick to act on that recommendation—mpulsory purchase guidance and best practice manual be devised, guiding acquiring authorities through all the twists and turns of the process. I might add that this apparently modest initiative has been widely welcomed, even by some authorities that view themselves as highly competent in that area.

I have given the House a brief overview to demonstrate that we recognise that the current system of compulsory purchase and compensation is widely perceived to be deficient, and that we are actually doing something about it. I have also sought to show that there are no simple solutions to any of the problems—east, that what are sometimes presented as simple solutions are, as often as not, fiercely resisted by those whose perspectives differ.

The hon. Lady she spoke at length about the electricity pylons in the Vale of York. She will doubtless appreciate that had that featured in the title of the debate, my hon. Friend the Minister for Small Firms, Trade and Industry would probably have responded, as he is in a far better position than I am to give a detailed answer on matters relating to wayleaves and electricity. I shall try to give as helpful a response as I can, albeit from a less authoritative position than my hon. Friend.

Miss McIntosh

May I put on record the fact that I had a detailed conversation with the Minister's office about the nature of the debate this evening, so I am slightly stunned by that remark?

Mr. Raynsford

As the hon. Lady will recognise, the choice of Minister to respond to the debate had already been made by that time, because the title of the debate related to compulsory purchase and compensation, without reference to electricity. As we established in a previous debate, responsibility under the Electricity Act 1989 lies with the Department of Trade and Industry.

The hon. Lady spoke about the National Grid Company's proposed electric line from Lackenby, in Cleveland, via Picton to Shipton in North Yorkshire—the North Yorkshire line An electricity Company usually obtains access rights to install a line over or under a particular piece of land by obtaining either a wayleave or a permanent easement from the landowner. If the company is unable to obtain such agreements voluntarily, it may apply to the Secretary of State for Trade and Industry for the grant of a compulsory wayleave, or to confirm a compulsory purchase order in respect of the required access rights.

In 1994 and 1995, the National Grid applied to the Secretary of State for the grant of a number of compulsory wayleaves to authorise it to install its proposed North Yorkshire overhead line. Following hearings into the applications, most of the wayleaves applied for were granted in March 1998. Since the Secretary of State's decisions on these matters, further wayleave applications have been confirmed relating to various sites along the route of the power line.

I know that the hon. Lady has written to DTI Ministers on several occasions on the subject of compensation and access rights granted under a compulsory wayleave. As she will now know, the Secretary of State has no powers to prescribe any financial conditions in any wayleaves that he grants.

Compensation falls to be settled by agreement between the landowner and the company or, failing agreement, by the Lands Tribunal. However, the industry has agreed with the Country Landowners Association, the National Farmers Union and the National Farmers Union in Wales a scale of compensation for poles, pylons and wires, and I understand that those are accepted in the overwhelming majority of cases.

The hon. Lady asked why the interests of farmers are not better protected. Clearly, that is a matter that she should take up with the NFU and the CLA, which agreed the scale of compensation for such arrangements.

Miss McIntosh

I am grateful for the Minister's generosity in giving way. There has been a clear abuse of compulsory powers. Initially, by offering an easement as opposed to a wayleave, the National Grid was offering a capital payment to reflect the depreciation in the value of the property. To those who did not take up the offer at the time, the National Grid has behaved shoddily. I hoped that the Minister would address the issue this evening.

Mr. Raynsford

As I have already explained to the hon. Lady, that is specifically a matter for my colleague, the Minister for Small Firms, Trade and Industry. As it is not my responsibility, I am not in a position to respond on the actions of the National Grid in relation to an electricity wayleave.

I know that a number of landowners who are the subject of compulsory wayleaves have argued that the wayleave grants the company only very limited access to their land, more or less along the route of the proposed line. That is a clear difference from compulsory purchase of a property for development, where the property is acquired to be disposed of. The arrangement necessitates a different regime from that which would apply in the case of compulsory acquisition.

A wayleave granted by the Secretary of State gives access rights for the purpose of installing and keeping installed the line, and for purposes relating to its maintenance. The access rights do not define particular parts of a plot of land to which access is granted. The wayleave identifies only the land at issue.

It is therefore necessary to look at the purpose of the wayleave so that access to sufficient land is allowed for installation and maintenance purposes. Obviously, that will involve a particular strip underneath the line, but it will also involve access to other parts of the land—for example, access from an entrance to the land to the strip underneath the line.

Although the wayleave identifies the line and the land in question, the detailed implementation of these rights—for example, agreeing working areas and access routes— is a matter for discussion and agreement between the landowner and the company. Obviously, given the different circumstances in different areas, there have to be agreements between the parties to ensure the minimum disruption and the most satisfactory arrangement to avoid causing inconvenience to the landowner.

Miss McIntosh

I think that the Minister, so far as he has responsibility, will accept that this is the crux of the debate. First, there has been an announcement—by either North Yorkshire county council or Hambleton district council—that the Queen's highways may not be used to access the land. The farmers' land will be used in the construction stage in a way that had never been imagined possible before. That has caused difficulties for the parties concerned reaching an agreement.

Secondly, family businesses are involved. The farmers are concerned that National Grid is unable to say exactly when it is coming in and exactly to what amount of land it wants access. Farmers in North Yorkshire, particularly cereal growers and beef producers, have gone through a record crisis and they need a degree of certainty in planning.

Mr. Raynsford

My understanding is that the company is currently attempting to negotiate on access routes and lines with the landowners. Clearly, if there are problems arising from those negotiations and the hon. Lady believes that this matter is being handled unsatisfactorily by the statutory undertaker, she should certainly take that up with my colleagues at the Department of Trade and Industry.

I am told that consent was refused for two short stretches of line—at Nunthorpe and near Newby— and so it fell to the company to consider placing those two stretches underground. I gather that it is the company's intention to route underground not only those two stretches, but the stretch of line between them.

The Secretary of State's powers to grant consent for electricity lines do not cover underground cables; accordingly, the company does not need to obtain consent. However, it must ensure that appropriate arrangements are made for access to allow construction and maintenance of the cable. I understand that the company is currently trying to negotiate voluntary agreements with the affected landowners. However, if voluntary agreements cannot be reached, the company may either apply for compulsory wayleaves or for the confirmation of compulsory purchase orders in respect of the access requirements.

According to the information available to me, the DTI has not received any applications for the confirmation of compulsory purchase orders. However, if any are received, the statutory procedures allow interested parties to make their case to a person appointed by the Secretary of State. Only after receiving the report of the appointed person will the Secretary of State express any view on any such applications.

I am conscious that I have not answered every last point relating to consents under the 1989 Act, but I have no doubt that my colleagues at the DTI would be happy to advise the hon. Lady further, should she wish to contact them.

Question put and agreed to.

Adjourned accordingly at eight minutes past Nine o'clock.