§ 2.38 p.m.
§ Order of the Day for the Second Reading read.
§ THE MINISTER WITHOUT PORTFOLIO (THE EARL OF MUNSTER)
My Lords, I beg to move that this Bill be now read a second time. After a discussion through the usual channels, it was found more convenient to postpone the Second Reading of this Bill from Thursday last, April 21, until to-day. I am glad, as I am sure all your Lordships are, to see that the noble Lord, Lord Silkin, has returned to his place, and I trust that he has recovered from his recent illness.
This Bill is divided into two parts. The first part seeks to amend the existing law on requisitioned houses, and the second part amends various Housing Acts affecting England and Wales, and Scotland. Although the war has been over for some ten years, there are still 60,000 houses held under requisitioning powers in which are dwelling to-day some 90,000 families. Of that figure just under 50,000 properties are situated in the Greater London area, so that to a large extent this measure deals with London. I think there can be no noble Lord in this House who would not agree that requisitioning was absolutely essential during the war years and, indeed, for several years thereafter; but it was never contemplated at that time that requisitioning under emergency powers should continue indefinitely or become a permanent part of our housing system.
The House may remember that local authorities have held these requisitioned properties as agents for Her Majesty's Government, although in practice, as I understand, they are now treated as part of the authorities' general housing pool. I do not think it would be unfair to local authorities to say that some of them, at any rate, have found it very convenient to cling to properties which were bequeathed to them in an emergency, for this reason: that any losses which may have occurred from time to time, in handling such properties have been paid for by Her Majesty's Government. The net cost is in the region of £6¼ million per annum. I feel sure the House will agree with me that the time has come when the old system should come to an 547 end and a new system should be introduced; a system which will remove any hardships to owners who are in serious or urgent need of their houses and who have up to date been unable to secure their release, and at the same time avoid causing hardship to families at present living in these requisitioned properties. I am glad to tell the House that the broad principles contained in this Bill have been agreed by the local authority associations. The measure has three main objects. The first is to bring to an end the use of requisitioning powers for housing purposes within the next five years; the second is to avoid causing hardship to those families at present living in these houses; and the third is to enable owners of requisitioned premises to secure their early release if they have urgent need of them.
With those few introductory remarks, let me turn to the Bill to explain its main clauses and to indicate how the Government's proposals will be implemented. Clause 1 transfers from the Minister of Housing to the local authority the right to possession of a requisitioned house until March 31, 1960. Clause 3 lays down that on the commencement of the Act, which will be one month after the Royal Assent has been given, any house which becomes vacant is to be released by the local authority unless the Minister grants them permission to retain it.
Clause 4 is of particular importance, for it is the first method by which the interests of families living in requisitioned houses can be safeguarded. Under this clause the local authority will invite owners to accept the present occupants as tenants, but the rents which are payable will be controlled under the Rent Acts. Any owner who accepts the licensee as a statutory tenant will be paid compensation for forgoing his right to vacant possession. I think noble Lords who are interested in this subject will realise that if the owner of a requisitioned house did not wish to occupy it himself or, indeed, to sell it, but was willing, on the other hand, to accept the present occupants under rent-controlled tenancies, it might well be a major contribution towards reducing the number of requisitioned premises. I should add that many occupants of requisitioned houses are having their rents subsidised at the present time, and the Bill empowers local 548 authorities to maintain these subsidies for a period of ten years. In such cases as those, the local authority will pay to the owner of the requisitioned house the difference between the full controlled rent and the lower subsidised rent, and these payments in accordance with the clause will rank for a grant from the Exchequer.
Clause 5 enables the owner of a requisitioned house to make application to the court for the release of the house if he requires it for his own purpose or for that of his near relatives. The clause gives owners exactly similar rights as the owner of a rent-controlled house, who to-day can apply to the court for possession for his own occupation. The application will, in this case, as in the other case, be considered by the court in the light of the relative hardships of the owner and the occupier. Clause 6 empowers the Minister to give directions to a local authority requiring them either to release a requisitioned house or to purchase, if the Minister is satisfied that the owner is suffering severe hardship. Clause 7 enables an owner who wishes to modernise his requisitioned house, or to convert it into flats with the aid of a grant under the Housing Acts, 1949 and 1954, and is prepared to offer tenancies to persons nominated by the local authority, to have his house released.
I now turn to deal with the financial provisions of the Bill which are set out in Clauses 9, 10 and 11. As I think I have already mentioned and, indeed, as noble Lords will be aware, up to date Her Majesty's Government have met the whole of the expenditure in connection with requisitioned houses and will continue to do so until April 1, 1956—that is to say, April 1 next year. From that date, local authorities will be required to bear 25 per cent. of the cost, and the remaining 75 per cent. will be reimbursed by the Exchequer. Provision is made in Clause 10 of the Bill to enable the Minister to make additional grants to local authorities in those areas where the burden of rates might become excessive; but, of course, the Minister will have to be satisfied that the local authority has taken all reasonable steps to reduce the number of requisitioned houses. For this purpose, a formula has been worked out in agreement with the local authority associations.
Under Clause 11 the Minister may make a grant to the local authority for 549 a house which is purchased or leased by them. The grant in both cases will amount to 75 per cent. for a period of twenty years on a purchase, or for ten years on a lease. I think the only other clause to which I need draw the attention of the House is Clause 16, which implements a recent recommendation of the Public Accounts Committee. In their Third Report for the year 1952–53, the Committee drew attention to the fact that no statutory limit had been laid down to the amount of advances which could be made from the Consolidated Fund to meet the operations of the Scottish Special Housing Association. Accordingly, this clause applies a limit on the advances which can be made. I have referred only briefly to the main clauses of the Bill and have endeavoured to give the House a description of each of those principal clauses. With that brief explanation, I beg to move that the Bill be now read a second time.
§ Moved, That the Bill be now read 2a.—(The Earl of Munster.)
§ 2.51 p.m.
§ LORD SILKIN
My Lords, may I first of all thank the noble Earl for his kindly reference to me and for his courtesy in postponing the Second Reading from last Thursday until to-day. I hope it will be a comfort to him to know that I feel much better for those few days' respite. May I also thank him for the clear way in which he has explained what is a fairly complicated Bill. It is very significant that, at a time when a large number of measures are falling by the wayside on account of the forthcoming Election, this particular measure, which is for the relief of landowners, is one of the few to be saved. It is somewhat indicative of the approach of the present Government that a measure for the protection of landowners should have priority over, say, a measure like the Road Traffic Bill which was concerned with the safety of the citizen on the road. These are matters which will no doubt be discussed outside. We have to deal with the Bill as we find it before us.
On the Third Reading in another place my right honourable friend Mr. Dalton said that this Bill was a very bad Bill when introduced, and that it left the Commons as a bad one; that although certain improvements had been made fundamentally it remained the same. I 550 should like to associate myself with that statement. The noble Earl described the three purposes of the Bill. I have no complaint with his description, although he laid equal emphasis on all three, and it seemed to me that that was not a correct description of what the Bill does. It enables owners of houses which were requisitioned both during the war and subsequent to the war to obtain possession of them at the latest within five years, but in certain circumstances somewhat earlier. The five-year period is certain. At the end of five years, the axe falls and every requisitioned house will go back to its owner.
I say at once that I agree with the noble Earl that there must come a time when requisitioned houses must be returned to their owners. I should never suggest for a moment that requisitioning should go on for all time. I will admit at once that the fact of requisitioning may cause hardship to some owners and that, if it is at all possible, they should get their houses back. But what strikes me about this Bill is that, whereas the owner of a requisitioned house will certainly and inevitably get his house back by the prescribed date, March 31, 1960, there is nothing in the Bill which gives the tenant any protection or makes any suggestion how he is to get on when the axe falls and the accommodation is released, which may be even earlier than 1960 if there is severe hardship or hardship on the owner. There is nothing in this Bill which sets out what is to happen to the poor unfortunate tenant.
I would ask the House to recollect for a moment—because in these matters public memories are very short—who these tenants or, as they are described in the Bill, licensees, occupying requisitioned houses, are. They are almost invariably people who have suffered as a result of the war, people whose homes were destroyed, who were rendered homeless. The emergency to which the noble Earl referred in the course of his speech was the emergency of hundreds of thousands of people having been rendered homeless by enemy action and something having to be done about it. I submit that this emergency still exists. If nothing is done for the licensees of these houses, these people will still be homeless and there is—I was going to say "nothing," but the noble Earl did refer to Clause 4 of the Bill—very little in the Bill which even suggests that the 551 problem of providing homes for these people when requisitioning comes to an end has been considered.
What is the consideration that has been given? The noble Earl talked of Clause 4. I think he also mentioned that there were other clauses, but he never referred further to them. Clause 4 is the clause which provides the protection for the tenant. And what is it? It is that the local authority may enter into an agreement with the owner, and the owner may, if he wishes to, accept the licensee as a tenant. The matter is entirely in the hands of the owner. It is for him to say whether or not he will accept the tenant. If he accepts the tenant or licensee, then certain financial consequences flow. But if he does not, then what? Nothing. No provision at all is made for the unfortunate licensee or tenant in the event of the owner not desiring to accept the licensee as a tenant. If the owner looks at the matter entirely from the point of view of his own self-interest, as he is entitled to do, and as he naturally will do, why should he accept the tenant or licensee at a controlled rent, with all the difficulty thereafter of having the tenancy perpetuated and being subject to the Rent Restrictions Acts? Why should he, when he can get vacant possession of the house and sell it at the inflated prices which are still current to-day? This so-called protection to the tenant is just a will-o'-the-wisp. I cannot imagine one case in a thousand where an owner would be willing to accept a licensee as a tenant under the conditions laid down in the Bill.
I do not want to deal with this matter at any length. My broad criticism of the Bill is that it gives no protection to the tenant or licensee during the five years in which it is possible for an owner to apply to the court or to the Minister to get possession. The owner has so many ways in which he can seek possession. He can, of course, go to court, and in many cases the very act of his threatening to go to court will be sufficient to frighten the licensee into giving possession. Incidentally, if the owner does go to court, and succeeds in establishing that his hardship is greater than that of the tenant, presumably the tenant will have to pay the cost of the proceedings, which is adding insult to injury: not only is he rendered homeless, but he also has to pay 552 the costs of establishing it. That will be the consequence. The owner can also go to the Minister: he can ask that his house should be acquired. There are no means by which the local authority can negotiate with an owner, but, as I understand the Bill, there are no powers of compulsory purchase if a local authority wish to acquire the property.
Furthermore, as has been pointed out in another place, a great many of these houses are unsuitable for permanent occupation, and it would be foolhardy on the part of a local authority to acquire these requisitioned houses on a large scale; and many of them will not do so. I suggest that it is not practical politics for a local authority to acquire them all. So we are left with the position that, whenever during the five years, the owner of a house can establish that he is suffering greater hardship than the tenant, or severe hardship, then the tenant can be dispossessed and there is nothing in the Bill that ensures that he will be given other accommodation. Certainly the owner is not required to give him alternative accommodation; nor is the local authority. At the end of five years what will certainly happen is that the owner will get possession automatically and the licensees will be left "in the air." This Bill would have been much improved if it had included something giving the tenant definite protection, so as to let him know that whatever happens, even if his hardship is not as great as that of the owner, he will not find himself without a roof over his head. If that is the intention, there is no reason at all why it should not be stated.
As the noble Earl has explained, some 60,000-odd dwellings, and 90,000 families, are involved. Most of them are in the London area, but a substantial number are in Birmingham. As I say, these are all victims of the war. The local authority find themselves in this difficulty: that in so far as they are able to provide alternative accommodation for families who become victims of this Bill, they are to that extent deferring the time when other families on the housing list, whose need may be equally great, can get possession of a house. I should have thought that the sensible thing would have been not to hurry this matter but to defer the date of possession until such time as the local authority are definitely 553 in a position to ensure that families who are dispossessed can get alternative accommodation.
There was some discussion about this matter in another place, and I believe that the Minister was prepared—I admit that he said he was not convinced of the need—to extend the period for two years, over and above the five years, in those cases where the local authority could establish that they needed a little longer. But he attached a condition which seemed to me, with all respect, to be an unreasonable condition—namely, that there should be no voting against the Third Reading of the Bill. There are other features of this Bill to which some of my friends in another place objected, and it seemed to me that to impose a condition of this kind in exchange for accepting an Amendment was utterly unreasonable, and something which deprived Members of another place of their proper rights.
We in this House are not going to divide against the Second Reading of the Bill, and we shall probably not divide against the Third Reading. In those circumstances, I should like to ask the noble Earl, Lord Munster, whether the extension of two years which the Minister in another place was prepared to grant, on certain conditions, might not be granted here. In any case it would have had to be done by way of an Amendment in this House, because the suggestion was made at a late stage in the proceedings in another place. If the noble Earl is prepared to give an assurance that that will be done on the Committee stage, it will go some little way towards meeting the fears of many people, particularly the local authorities in areas where there are a large number of requisitioned houses, that they may be faced with a crisis because they will not be able to provide the housing that is needed when requisitioning comes to an end. It will also remove the fears of tenants who are in a state of considerable anxiety and uncertainty about what will happen to them at the end of the requisitioning period. As I have said, we do not propose to divide against the Second Reading. We think it somewhat strange that this Bill, of all others, should have been rescued from the guillotine, but I hope that even at this late stage the noble Earl will be able to do something to make the Bill 554 a better Bill and one which will give less anxiety to those who are so deeply concerned about it.
§ 3.8 p.m.
My Lords, it is always rather difficult to speak after the noble Lord, Lord Silkin, because he has such a profound knowledge of this matter in which everybody else appears to be a mere amateur. I should, however, like to congratulate the Government upon having introduced this Bill, which deals with a rather difficult subject. I do not think that the Bill will cause any profound satisfaction or achieve any profound objective, but that is not the fault of the Government; it is due entirely to the complexity of the problem. The difficulty is that the subject of requisition, like the subject of rent restriction, will be solved only by the erection of more dwelling-houses.
I know that noble Lords have no jurisdiction over financial matters, but I am sorry to see that within a short time 25 per cent. of the cost of management of requisitioned premises will have to be borne by the local authorities. In my view, the present arrangement, under which the Exchequer carry the whole 100 per cent. of the expense, is far more equitable and should be continued. The burden of local rates is an absolute abomination of desolation. It has increased, is increasing and is likely to increase ad infinitum. Therefore, in the circumstances, what is going to be done should there be any great increase in local rates? Moveover, 80 per cent. of these properties are in the Greater London area, and a certain number of boroughs in that area are likely to suffer a considerable increase in the rates. I appreciate that, under Clause 10 (2) of the Bill, the Minister has power to make a special grant to a local authority; but that is a somewhat indefinite and circuitous way of dealing with the matter. It would be far more simple, and fairer, to say that the Exchequer will continue to pay the whole of the amount of the expense of requisitioned premises.
Passing to Clause 4, which I consider is one of the most important in the Bill, I would say that here again Her Majesty's Government should be thanked for having materially amended the clause since the Bill was first introduced. It deals with a number of important matters, including liability for payment of rates. There are, however, a few comments which one may 555 still make upon it. The owner may receive a notice inviting him to accord to the licensee of the dwelling the status of statutory tenant. I should like to know, as a matter of interest, what will happen to an owner who does not accept that invitation. I recollect that a gentleman called Mr. Daniel once received an invitation to "Messrs. Lions"; but history does not tell us of any second invitation. I should also like to see a definition of "statutory tenant." Her Majesty's Government may say, quite correctly, that it is unnecessary to have any such definition because Clause 4 deals with that matter. But there are various types of statutory tenant. There are those who remain on after the termination of a contractual tenancy; there are those who become statutory tenants on the death of the previous statutory tenant by virtue of some relationship. Curiously enough, when one comes to Part I of the Landlord and Tenant Act, 1954, one finds there are statutory tenants who become statutory tenants at the termination of a ground lease yet who were not previously within the protection of the Rent Restrictions Acts. The position might be made clearer by a definition of a statutory tenant.
In subsection (4) I see a reference to a statutory successor of a licensee. What happens when a statutory tenant dies before 1960 and leave no widow or other dependent who would otherwise be entitled to succeed him under the provisions of the Rent Restrictions Acts? In those circumstances a dwelling, which might be a flat or an entire building, may become vacant. Can an owner resume possession or is he bound to let the premises again to some other person who becomes a statutory tenant? That may be a rather extraordinary way of becoming a statutory tenant, but I assume that that is what will happen. In the circumstances I have mentioned, will the landlord be entitled himself to resume possession? If, in fact, the Rent Restrictions Acts applied in the ordinary way, the landlord would certainly be entitled to resume possession where the premises became vacant.
In regard to repairs it appears that, under Clause 4 (2), paragraph (a), terminal compensation under the Compensation (Defence) Act, 1939, becomes payable when a local authority give up possession—that is to say, one week or there- 556 abouts after the owner accepts the invitation mentioned in that clause. I do not wish to say anything defamatory about licensees of requisitioned premises, but the bare truth is that the majority of requisitioned premises in this country are in a most deplorable state of repair and require a great deal to be done to them. In order to carry out the desired repairs it may be necessary for landlords to have very wide powers of entry and, if necessary, to be able to go to the county court and obtain possession in order to carry out those repairs. I hope that Her Majesty's Government will look at that point between now and the Committee stage to see whether it is covered by the Bill as at present drafted.
With regard to terminal compensation payable under the 1939 Act, the extraordinary position is that an owner of premises may receive compensation but is not compelled to use it in carrying out any repairs. If he has let the premises to a tenant there may be some contractual arrangement made between him and the tenant as to what ought to be done with the money; but the ordinary owner-occupier who receives terminal compensation under the 1939 Act is not compelled, as far as I know, to spend that money on repairs to the premises. Last but not least, I should like to know whether the provisions of the Housing (Repairs and Rents) Act, 1954, are in any way excluded by the provisions of the present Bill. Suppose that an owner of premises complies with the requirements of that Act and spends the necessary money in carrying out repairs within the required time; will he be entitled to increase the rent of the statutory tenant? I consider Clause 4 is important. If I have raised any "red herrings" I hope they may be struck out; but if any suggestion of mine is considered worthy of consideration, I hope Her Majesty's Government will consider it.
§ 3.18 p.m.
§ THE EARL OF MUNSTER
My Lords, it is hardly surprising that at this particular time in the fortunes of the country many issues should be conjured up in order that one or other of the Parties might make a satisfactory appeal to the electorate. I was not in the least surprised, therefore, to hear the opening observations of the noble Lord, Lord Silkin, that this measure might well have fallen by the wayside had it not been one which was 557 devised entirely for the relief of landowners. I thought that, once again, the noble Lord was drawing a red herring across the trail. There is no foundation whatsoever for the charge that, as the result of the passage into law of this Bill, many people will be homeless by 1960 or (in the words of the noble Lord opposite) will be living in a state of uncertainty or deep anxiety. I would suggest, subject to correction, that the noble Lord probably would never have made that charge without an ear to popular appeal. Perhaps he will forgive me for saying that it may be because he is bankrupt of all criticism of Her Majesty's Government. The noble Lord reminded me of that old story of the blind man who was searching in a dark room for a black hat which was not there.
§ LORD SILKIN
The noble Earl says he speaks subject to correction and I should therefore like to take the first opportunity of correcting him. I had thought of making this same speech, apart from the reference to the Election, even had there been no Election impending.
§ THE EARL OF MUNSTER
I naturally accept what the noble Lord says, but obviously he will not mind my observations as a result of his speech.
What is the position of those now living in requisitioned houses? Are they threatened with wholesale eviction after 1960? Is their security of tenure seriously jeopardised? The 90,000 families who are living in these requisitioned properties are not all people who were suffering from enemy action. Let me remind the noble Lord that at the end of the war there were some 71,500 properties which had been requisitioned. After the war, some 52,000 extra properties were added; and since the end of the war, about 62,000 properties have been released. So it seems to me that this is not a matter of dealing merely with those people who were bombed out of their original homes by enemy action and had to move elsewhere. Of course, neither my right honourable friend the Minister of Housing nor, indeed, Her Majesty's Government ever contemplated releasing requisitioned houses without making adequate provision for the existing occupants. As I say, the Bill does nothing to make any one homeless at all.
558 I wonder whether the noble Lord opposite really believes that the local authority associations would have approved the proposals in this Bill if the noble Lord's fears were genuine. Let me remind the House what they said. They said this:We consider that the proposals provide a reasonable and workable scheme for bringing emergency requisitioning procedure to an end.With due respect to the housing obligations of the borough councils, between now and 1960 many occupants of these requisitioned houses will move out of their present premises into council houses or elsewhere. In fact, moves of that sort, as the noble Lord knows better than I do, are proceeding continuously; and since the introduction of the Bill in another place the number of requisitioned properties has already shown a decrease. If the noble Lord will turn to the Bill, he will find that, under Clause 3, a local authority who find difficulty in providing alternative accommodation for the inhabitants of a requisitioned house may retain possession of that house by agreement with the Ministry——
§ THE EARL OF MUNSTER
I am coming to that. I am trying to deal with individual points. Local authorities can, subject to the Minister's agreement, retain possession of these premises.
We go from there to Clause 4. There are, I am told, a number of owners of requisitioned properties who would be willing to accept the licensee as a statutory tenant where the provisions of the Rent Acts apply. It is believed—I think not without some truth—that many of the owners of requisitioned premises already have other houses in which they are living. They would, therefore, be prepared to let their houses in accordance with the terms of the Rent Acts, more especially as they have an opportunity of obtaining some compensation under Clause 4. Under Clause 5, if the owner, having appealed to the court for the release of his house on grounds of hardship, obtains it, then the local authority will provide the occupants with other accommodation. The noble Lord may well say: Where? Well, those individuals can be housed under Clause 3, which gives the local authority power to retain possession 559 with the consent of the Minister, of certain houses. And I have no doubt whatever that there will not be all that number of cases which will go to the courts, which will judge, as they are doing to-day, which is the greater hardship—that of the owner or that of the existing tenant. In any event, let me assure the noble Lord that the cost of proceedings may certainly be borne by the owner; they may certainly be borne by the local authority, but they will never, in fact, be borne by the tenant.
We come next to Clause 6 which enables a local authority to make the owner an offer to purchase the house. Having obtained that house by purchase, the local authority will clearly be able to put into that particular property any tenants of the present requisitioned houses. Local authorities, as the noble Lord knows well, can also rent houses they need to retain after 1960. I am advised that there are a considerable number of owners of requisitioned properties who would be perfectly willing to let their property to a local authority for a period of ten or fifteen years. Again, in London (and this is primarily, as the noble Lord agrees, a London problem) a local authority may well have to provide alternative accommodation by purchase; and they already possess compulsory purchase powers under the Housing Act, 1936. It is true that we hope these compulsory powers will be used only in a last resort. From advice which I have received, I have reason to believe that there are many owners who would be prepared to offer their houses for sale at a reasonable and proper price.
I hope that I have—I will not say persuaded, but moved, the noble Lord to believe me when I say that, under the terms of this measure, there is no reason whatsoever why tenants of requisitioned properties should, either before or after 1960, have any fear about finding themselves thrown out of their present houses. The noble Lord was good enough to give me some information which tended to show that he was thinking of putting down an Amendment at a later stage of the Bill, to see whether it would not be possible to extend the five-year period by a further two years. My immediate answer is that I do not think that that is really necessary. If it had been necessary, 560 I imagine that the local authority associations would have impressed that particular point upon my right honourable friend himself.
I pass on to reply, very briefly, to one or two points which were made by the noble Lord, Lord Meston. He asked whether there was a definition of "statutory tenant" in Clause 4. There is no definition of the actual words "statutory tenant," because it was thought that those words themselves served to emphasise that the tenant will, in fact, have the protection of the Rent Acts. Then the noble Lord asked me what would happen where, under, I think, Clause 5, the owner accepted a licensee as a statutory tenant and that tenant vacated the property or died without a legal successor. What would happen to the house? I think it is clear that in those circumstances the landlord could occupy the property himself or sell it. In short, in those circumstances the house would revert to the owner under the ordinary arrangements of the Rent Acts at the present time. There were various other detailed points which the noble Lord put to me, and upon which I will let him have a reply in due course—no doubt, he will put down Amendments on the next stage of the Bill. In passing, he wished to know whether an owner taking advantage of Clause 7 (which enables an owner to modernise his house or to convert it into flats) would he be eligible to secure aid under the Housing Act, 1954. The answer is, that he would be able to secure aid under that Act, as well as under the Housing Act, 1949, and that his premises would then be derequisitioned on the understanding that he offered tenancies to those people who were nominated by the local authority.
I hope that I have answered the main questions addressed to me. As it is now getting late in the Session, I wonder whether the House would allow me, in view of the fact that we have postponed the Second Reading of the Bill to have the Committee stage for Thursday, the day after to-morrow, in order that on that occasion the Bill may pass through its remaining stages in this House.
§ On Question, Bill read 2a and committed to a Committee of the Whole House.