LEASEHOLD PROPERTY ACT AND LONG LEASES (SCOTLAND) ACT EXTENSION BILL [H.L.] (Hansard, 18 February 1953)

THE LORD CHANCELLOR
My Lords, I beg to move that this Bill be now read a second time.

§ EARL JOWITT
My Lords, I think the arrangement we have had to-day has been a most convenient one. We have had a general discussion on the White Paper which has really covered the subject matter of this Bill, and I am quite sure that your Lordships do not want to hear any more about this Bill from me now. I have a kind of satisfaction. I have just been looking through the incidents that took place when I introduced the Bill which is now being extended. I see cheery faces opposite me at the present moment, though the same faces were then very hostile to me. There sits the noble Viscount, Lord Buck master, in peace and contentment, but when I introduced my Bill, which is now being extended with his obvious approval and delight, it was described as a measure which utterly violated the sanctity of existing contracts. Very harsh things were said about it. I am glad to think that, notwithstanding all the energy and 560 skill which have been employed on this matter, the Government have decided that they can do no better, as a temporary measure, than I did as a temporary measure some year or so ago.
I should like just to add this. I was very surprised to hear the Lord Chancellor say—though I may have misunderstood him—that he thought the system of long leases which had been developed over the centuries was a good and satisfactory system. I think it was an absolutely disastrous system. The whole difficulty of the problem, however, is in knowing what to do now, in view of the fact that that system has lasted so long, that interests have arisen, that money has been invested and things of that sort. That, to my mind, is the real difficulty, and if any of us to-day could start with a clean slate, I venture to say, with great respect to the Lord Chancellor, that I think all of us would say, "Well, this system whereby you had long leases for ninety-nine years—the men who were building the houses and all that sort of thing—has turned out, in the events which have happened, to be a most unhappy system."
It is sometimes (said that the real grievance of these tenants is that they thought the property was theirs. I do not doubt that in some cases that is true. The real trouble is that the situation which exists now, when the lease is coming to an end, is so totally different from the situation that existed when the lease was granted. When the lease started there may, for aught I know, have been plentiful accommodation. Now, unhappily, when the lease has come to an end, there is practically none. The problem which confronts us all is, "What are we to do about it?" I concede at once that it is a very difficult question. I also concede at once that merely repeating the phrase "leasehold enfranchisement," as if it were a kind of incantation, is not to the point. Anybody who has studied this matter knows that the whole problem is: on what terms do you enfranchise your lease? Unless and until you enumerate what those terms are, you cannot do much about it.
I confess that I am sorry that the Government have bolted and barred the door on leasehold enfranchisement. I believe that it would have been useful to have more thought given to this matter. No doubt when we come to 561 consider the Bill which is envisaged for the future we shall have an opportunity of considering the matter. That is all I rise to say. I take it as a sincere compliment that the noble and learned Lord is extending for a still further period of time this wholly admirable temporary Bill which I introduced. I call it "wholly admirable," because, although I never liked it, and nobody else liked it very much, we all came to the conclusion that in the circumstances it was the best thing we could do. Her Majesty's Government have obviously come to the same conclusion. Therefore, we shall certainly not oppose the Second Reading of this Bill.

§ LORD LLEWELLIN
My Lords, I believe that I am in order in speaking again because we are now on another item. As the noble and learned Earl has referred to some smiling and cheerful faces on this side, and said that surely, if we went back to the past, if we could start with a clean slate, we should not have these long leasehold terms at all, I cannot help reminding the noble and learned Earl that he was a member of the Government which started new towns with a clean slate. And the only thing that the development corporation is allowed to do is to let its land on leases not exceeding ninety-nine years. The problems which that situation may create in ninety-nine years none of us can envisage now. After Lord Jowitt's speech, in which he twitted us very pleasantly, if I may say so, I thought I might just rise and twit back on that, because both in the Town and Country Planning Act and in the New Towns Act there is being started exactly the same thing, under, it is true, the development, corporation or the planning authority. But the tenant would be no more happy to know that his reversion goes back to them than he would be to know that it goes back to a private individual.

THE LORD CHANCELLOR
The noble and learned Earl, Lord Jowitt, did not speak on the White Paper which dealt with leasehold enfranchisement, in which case I should have had an opportunity of replying to him, but chose to make his speech upon leasehold enfranchisement in regard to this Bill which does not deal 562 with that matter at all. It was rather a strange proceeding, I thought. The noble Earl commented upon the fact that I had said that the leasehold system, and particularly the long leasehold system, worked well. I do not know whether I used those exact words, but the noble Lord, Lord Llewellin, has pointed out that, if I did so, I did so following the example of the Government of which the noble and learned Earl was a member. The leasehold system is a good one, but, like other systems, it is capable of being worked badly by bad men. It is a good system and, on the whole, it has worked very well in this country. Unfortunately, it has given opportunity for had landlords to act badly and, I think, for unreasonable tenants to act badly, too. That is all I want to say.

§ EARL JOWITT
Is that not the test, after all, of a good or a bad system? If a system enables bad landlords to exploit the situation, is that not, by virtue of that very fact, a bad system? Whilst not attacking the leasehold system as such, I venture to think that the vice of the long lease was that it gave men the chance to exploit, and they did exploit.

THE LORD CHANCELLOR
The noble and learned Earl has made his point, which might better have been made, I think, before the Motion was withdrawn, and the noble Lord, Lord Llewellin, has dealt with it.
With regard to this particular Bill, providing for an extension of the Act which the noble and learned Earl introduced in 1951, there is, of course, this vital difference: that that measure, which provided for a two years' extension period, was not accompanied by any statement as to what was the policy of His Majesty's Government in regard to the future. Our proposed extension by this Bill is mitigated by this: that it does not leave either tenant or landlord in darkness as to what is the future policy of Her Majesty's Government. One cannot tell what may happen before Christmas, 1954; no doubt noble Lords on one side or the other have hopes. But at any rate, the policy of Her Majesty's Government is there laid down, and that, I think, is why the Bill, even though it does inflict a great hardship, as I realise, upon ground landlords, is accepted by them will good will, which the Bill of 1951 was not, because then 563 they did not know what legislation was coming in the future.