HL Deb 14 July 1958 vol 210 cc978-1025

4.7 p.m.

Order of the Day for the House to be put into Committee read.

Moved, That the House do now resolve itself into Committee.—(Earl Waldegrave.)

On Question, Motion agreed to.

House in Committee accordingly.

[The LORD MERTHYR in the Chair.]

Clause 1:

Repeal of powers of supervision, direction and dispossession under Part II of Agriculture Act, 1947, and Part II of Agriculture (Scotland) Act, 1948

1.—(1) So much of Part II of the Agriculture Act. 1947 (in this Act referred to as "the Act of 1947") as provides for supervision orders, and for the giving of directions to and the dispossession of owners or occupiers on grounds of bad estate management or bad husbandry, that is to say sections twelve to twenty of that Act, shall cease to have effect, and all entries in the register of local land charges relating to supervision orders shall, as soon as may be after the passing of this Act, be deleted.

(2) So much of Part II of the Agriculture (Scotland) Act, 1948 (in this Act referred to as "the Scottish Act of 1948") as provides for warning notices, and for the giving of directions to and the dispossession of owners or occupiers on grounds of bad estate management or bad husbandry, that is to say sections twenty-seven to thirty-four of that Act, shall cease to have effect.

On Question, Whether Clause 1 shall stand part of the Bill?

VISCOUNT ALEXANDER OF HILLSBOROUGH

I beg to move the omission of this clause. We have not put down an Amendment to it, because all we can do is to vote against it. I am glad I managed to get back in time for the opening of this debate, because I feel very strongly about it. I have to apologise to the noble Earl, Lord St. Aldwyn, that I was not able to stay on the Second Reading and listen to his reply, but I have read his reply now, and I can agree neither with him nor with the noble Earl, Lord Halifax, that there was no background or case for my submitting to the House that this Part of the Bill is a betrayal of British agriculture. I was rather amazed at the percentage arguments that were used by the noble Earl, Lord St. Aldwyn, in his reply to me the other day: that about 1 per cent. of the farmers were concerned and their food production was 0.01 per cent.; while they used an even smaller percentage of the actual use of fertilisers. This referred to the people who were under supervision: not to those who were under supervision at any time during the operation of the controls, but the people who were apparently under supervision later.

I want to say quite frankly that your Lordships ought to take careful note, first of all, that this clause effects a most important change in regard to nearly two-thirds of the farmers in the country. Nearly two-thirds of the farmers are tenant farmers, and I am not interested, therefore, in the noble Earl's percentages that he gave in his reply on July 3. [OFFICIAL REPORT, Vol. 210 (No. 87), col. 603]. The whole principle of this question is that they will be put into a different category from owner-occupiers. Owner-occupiers will no longer be under the necessity of having some supervision and control as some justification for the public money they receive in the way of subsidies. But all the practically corresponding sanctions can be taken, apparently, against the rest of the industry, the tenant farmers—nearly two-thirds of the total number of farmers—through the use of landlord practice. Now, that is the bare fact of this change. We submit that this comes on top of a steady undermining of what the normal results of administering the other parts of the Agriculture Act, 1947, should be.

There is a great deal of talk about the period of stability and of the long-term guarantees. By the way, the first period of guarantee cannot, under the 1957 Act, go beyond four years. In my view, the Government are betraying the agricultural industry in this matter, in view of the pledges they gave to the industry in the General Elections of 1950 and 1951. Those Elections showed basically the feeling of the country at large, and there was not the slightest indication in either of those Elections that the Conservative Party, when a Government, intended to take any such action as they are now taking with regard to Part II of the 1947 Act. The undermining of the general economic position of the tenant farmers, as well as of other farmers, has been proved to me over and over again by the various journals I read week after week, the publications of both the farming and the motor industries. I find a general summary of their views in a headline, not from a Labour paper or from a farming journal, but from a publication called Farming Report, which is published by a large firm of producers of tractors and agricultural equipment for farmers from whom they want to continue to get orders for the support of the British engineering industry. The headline to interviews with some of these farmers reads: The more proficient we get, the less our reward. That sums up the attitude of a large proportion of farmers to-day.

The only benefit left to them as tenant farmers was that they could not be displaced, under security of tenure, unless a properly constituted county agricultural executive committee, of farmers who knew them, knew their circumstances and what they could do, were satisfied, after they had been given the opportunity of a period of supervision, that they should be displaced. Now the Government are changing from that and giving power back to the landlords, with submission to a tribunal. We shall have to wait and see what the result of this further piece of Conservative denigration of the pledges made by all Parties to the farmers since the last war will be on the economic position of the individual farmer and its general effect upon the industry as a whole. I think it is a most retrograde step to take away public supervision of the spending of the subsidies which are offered because, first of all, they ought to be adequate, and, if they are, they ought to bring a reasonable reward to the farmers in expanding production. Their net income ought not to be going down all the time, as it has been over the last six and a half years, largely owing to the Government's economic policy, when at the same time there has been a steady increase in the costs to the farmers.

Unless the Government are very careful, they are going to see an undermining of the contribution which has been made so bravely and efficiently in all the years since the war ended and which has produced such a development of agriculture that it has become a predominant factor in the balance of payments. What is the answer of the Government?—that the landlords will not misuse their power and will always be subject, afterwards, to an agricultural tribunal. That is about the only answer we can get. I am bound to say that I would not let any Bill with this clause pass through this or any other Chamber without trying to see whether we can get it defeated. Therefore, I shall vote against the clause.

EARL WALDEGRAVE

I have listened with great care to the noble Viscount the Leader of the Opposition. I think that his speech fell into two sections. He referred, first of all, to the owner-occupier. I admit that, without the old sanctions, the owner-occupier will give up farming only when he does it so badly that it no longer pays him to go on farming. That is the sanction that will apply to the owner-occupier, and it is the proper sanction. The more general part of the noble Viscount's speech was that the Government had been guilty of "general denigration" of agriculture, a "general betrayal" and so on. I really do not see what that has to do with Clause 1 of the Bill, which repeals Part II of the 1947 Act. It could be argued the other way. The Government are not deserting agriculture. I do not believe that any Government would wish to desert agriculture, and the taking away of disciplinary powers, which have not been used and could not be used properly to-day, cannot be described in that way. It is a great exaggeration to say that.

Agriculture has done its task extremely well over the past decade. Productivity has increased. There has been a vital and a valuable dollar saving. No Government is going to throw away or neglect agriculture—certainly not this Government, and to say that taking away these powers of supervision is to do that is, in my view, to outrage normal logic. But as the noble Viscount has raised this point, I will deal with it. I think it is established that there are many people who say that they would like to see these powers remain on the Statute Book on the tacit understanding that nobody is going to use them. If that is in anybody's mind, it is a dishonest argument, which should not be used, and one which no courageous and proper Government can use.

VISCOUNT ALEXANDER OF HILLSBOROUGH

Is the noble Earl charging the Opposition with dishonesty on this matter? I should like to be clear about his language. If so, that is not the position at all. The position is that we say that this power has been most useful, that it has been allowed to fall much more into disuse during the office of the present Government and that, if we were in office, we would see that it was properly used to justify the expenditure of public money and to maintain efficiency and encourage expansion.

EARL WALDEGRAVE

I am much obliged to the noble Viscount. Of course, I am not charging him or his Party with dishonesty. I said that some people have used that argument, and it is an argument that I think we must all combine to say is not proper. The fact remains that if these powers are to remain on the Statute Book, and as the noble Viscount says, are to be used, we have to find somebody to use them. The noble Lord, Lord Silkin, spoke of this point on Second Reading.

After the Government had accepted the proposal of the Franks Committee, of which the noble Lord, Lord Silkin, was a member, the way in which these powers would have had to be operated would have been different from the way in which they had been used before. In our view, we should have had to put the agricultural executive committees in an impossible position by taking away from them, as the Franks Report said we should, their adjudicating function, leaving them with rôle of prosecutor. When that has to be considered, surely the proper thing to do, before you go into detail as to how these powers are to be altered, is to say: Are these powers necessary at all? The conclusion we were bound to come to was that they were not. The 63 per cent. increase in production over pre-war has not been arrived at by the use of half a dozen or so disciplinary powers that have been imposed, but by the good sense and good will of the major part of the farming community, backed by the National Agricultural Advisory Service.

VISCOUNT ALEXANDER OF HILLSBOROUGH

And backed up, too, by the National Farmers' Union.

EARL WALDEGRAVE

The National Farmers' Union have certainly backed the agricultural production drive; and as I was saying, the industry have a very good record. This clause must, of course, stand.

EARL WINTERTON

Before your Lordships go to a Division, I should like to protest, I hope politely, against the vigour and vehemence of the speech of the Leader of the Opposition, which I think is all the more regrettable in view of the position that he occupies in the country and in this House. He has no authority for saying that this is a betrayal of agriculture. As the Minister has just pointed out, the National Farmers' Union have not said so. The National Farmers' Union often use strong language when they disagree with the actions of any Government; and if they agreed with the noble Viscount opposite they would have said so. I think his speech is calculated to do harm.

VISCOUNT ALEXANDER OF HILLSBOROUGH

Perhaps I may interrupt the noble Earl. They have said so, and in fact supplied the Opposition with their views against this clause before it came to this House from another place.

EARL WINTERTON

I do not think they have used the very violent language (I stand subject to correction) of "betrayal". They may have objected to the clause, but the words "betrayal of agriculture" are strong words to use, and, I think, calculated to do harm. I do not want to get into controversy with the noble Viscount, but we all know the attitude of the Opposition to the question of control. I think the Government are right to do what they have done, and I hope that the agricultural industry will not take too much notice of the speech of the noble Viscount.

LORD SILKIN

It ill becomes the noble Earl, Lord Winterton, to rebuke my noble friend for violence of language: it reminds me of Satan rebuking sin. The noble Earl has never been unduly restrained in expressing his views—and good luck to him ! But he must not complain if my noble friend expresses himself vigorously because he feels vigorous. Let me clear up one point. I think the noble Earl who spoke for the Government gave the impression that the National Farmers' Union were in favour of the repeal of Part II of the 1947 Act.

EARL WALDEGRAVE

I did not say that.

LORD SILKIN

Then I have nothing more to say as to that. But the fact remains—and let us be clear about it— the National Farmers' Union are against the repeal of Part II of the 1947 Act. On the Second Reading debate I read out extracts from a letter which they had sent to me and other noble Lords, and it is clear that, even after the proceedings in the other place, they still remained unconvinced and thought it wrong that Part II of the Act should be repealed. The National Farmers' Union speak for the vast majority of farmers; they have not been repudiated by the farmers, and therefore it must be assumed that the farmers themselves are against the repeal of Part II of the 1947 Act.

If this was such a frustrating business; if they were against control, and control was such an evil, why is it that they are against the repeal of Part II of that Act? The reason is, I think, abundantly clear: that they suspect that this is the first stage towards the repeal of the subsidy. And they have some ground for feeling that way. It is that all this has happened before in exactly the same way. It was a long time ago, and if I quoted the date noble Lords would say that things are much different to-day from what they were then. But it was a Government of the same political colour that repealed the Agriculture Act, after similar action by this House—my noble friend Lord Alexander of Hillsborough gave a quotation on Second Reading. They really do believe there is a precedent for their fears, and that they are not at all groundless. First of all, you remove control and you remove any supervision certainly on the owner-occupiers—the supervision of the tenant farmer is indirect and is exercised by the landlord—and then you say: How can you possibly justify giving public money by way of subsidy without any assurance as to the efficiency of the industry?

It is true that there has been an increase in output, due to a variety of reasons, and I am willing to accept that one of them is some increase in efficiency. There has been a great deal of mechanisation, of course, and a good deal of improvement in that direction. But this removal of control and supervision will be used, they fear, as a reason for the removal of subsidy in due course. While it is a fact that the Agriculture Act passed last year gives some guarantee, it is for a limited period and on a declining basis. The noble Earl, Lord Waldegrave, said that the Government were content to base the efficiency on the practical ground that the owner-occupier would not continue to farm unless he was making a profit; he would have a control of the financial result. I deny that. There are many farmers who are farming to-day, owner-occupiers, who are losing money, and who will continue to lose money and do not mind losing money, for the reason I gave on Second Reading—namely, that they are able to set off their losses in farming against their other income; and where they are sur-tax payers, especially in the higher categories, their losses are to a large extent met by the Exchequer. Therefore, they have no objection to losing money. I have met a number of people who proudly tell me of how much money they are losing, and they do not mind a bit; it does not cost them very much. Therefore, that is no guarantee of efficiency.

There is a fear that if this sort of thing goes on there will be produced the argument that it is wrong that the Government should spend on subsidy for this sort of purpose and for creating inefficiency. It is not those people we are concerned about. We are concerned about the ordinary farmer who farms for his livelihood, who depends on farming for his livelihod, and knows that he cannot compete against the people of foreign countries who export their goods to this country. I happen to know one particular aspect of farming, and I know perfectly well that without that subsidy it would be impossible for the British farmer to continue. It is that person I am concerned with, and it is that person who fears that his livelihood would be taken away from him by the removal of the subsidy. He has no real assurance that the subsidy will continue, and he fears, as I have said, that this clause will be used as an argument.

The noble Earl also put forward the case that as a result of the Franks Report it had been necessary to review the whole question, and that on the review the question had arisen as to whether or not supervision was justified at all. I should like to repeat what I said on Second Reading. The Franks Committee did not recommend that there should be a removal of supervision. All they recommended was that there should be a further examination of the procedure under which supervision was taking place. It would have been perfectly easy to alter the procedure: we on this side are not standing by the exact details of the procedure for supervision under the 1947 Act. I hope that we can eliminate the Franks Report, except as giving rise to the need for an examination of the procedure. I was a member of the Franks Committee. I signed the Report, and I agreed that some amendment in the procedure was necessary. But the Committee went out of their way to say that they were not at all concerned with the policy.

As to the policy of abandoning supervision, the noble Earl justified that step on the ground that the industry was so efficient, that there had been so few supervision orders made in recent years, that it would be right to abandon the policy altogether. I have already given one reason why the farmers fear the abandonment of supervision. I feel that supervision, with subsequent eviction, if necessary, was right in the interests of efficiency. It was welcomed by the industry because, coupled with supervision, there was all the advice and help that was given by the agricultural executive committees. It was being given to the farmers by their own neighbours and friends. Those farmers who were the victims of supervision welcomed it because they received a great deal of help, friendly advice and assistance. Nobody felt it at all oppressive, and we could have achieved the same sort of results by an alteration in the procedure, which would not have been open to the objections set out by the Franks Committee. The noble Earl has done nothing to convince me that this action is in the least justified. Though I do not suppose for a moment the Government are going to alter their minds, I feel that we on this side have to register a strong opposition to this change, which is uncalled for and will create a great deal of apprehension in the minds of the small owner-occupiers of farms.

LORD WISE

Before we close this discussion, I should like to ask the Government a question in regard to their intention in respect of the sections of Part II of the 1947 Act which this clause does not seek to repeal. It is obvious—or it should be obvious, at any rate—that both sides of the Committee are anxious that agriculture should play its full part in the life of the nation and should not go down, as we consider at the moment it may do. It is necessary both for the owners and the tenants to do whatever they can to promote production.

The sections in Part II of the 1947 Act which are to be repealed are Sections 12 to 20. Sections 9, 10 and 11 deal with the question of good estate management and good husbandry. Section 9 says: The following provisions of this Part of this Act shall have effect for the purpose of securing that owners of agricultural land fulfil their responsibilities "— and this is the point I wish to make here— to manage the land in accordance with the rules of good estate management, and that occupiers of agricultural land fulfil their responsibilities to farm the land in accordance with the rules of good husbandry. How are the Government going to enforce those rules? They cannot. There is no process in this particular Bill to ensure that the owners exercise good estate management, and there is a definite process in this Bill whereby the tenants carry out their obligations under these sections of the 1947 Act which we are still leaving as part of the law of the land. I am anxious that agriculture should play its proper part in accordance with the 1947 Act. I am particularly distressed that the Government are removing the supervision powers in this particular Part of the 1947 Act because I am the only Member of your Lordships' House who was a member of the Committee which steered that Bill through another place. It is a matter of regret, therefore, that the labour which we put into making it a good Act should now be set aside by Her Majesty's Government.

EARL DE LA WARR

I had not intended to intervene in this discussion, because I do not think it is the desire of the House that on each stage of a Bill we should embark on what is really a repetition of our Second Reading speeches. I should like briefly to congratulate the noble Lord, Lord Silkin, in moving in such wealthy circles that most of his friends can afford to lose money.

VISCOUNT ALEXANDER OF HILLSBOROUGH

That is very cheap.

EARL DE LA WARR

I congratulate the noble Lord also in the persistence with which he and his friends seek to exploit politically the admitted disquiet—

LORD SILKIN

I must correct the noble Earl. I did not say they were friends of mine.

EARL DE LA WARR

Perhaps they were not friends—acquaintances. Obviously he still moves in very good circles. I congratulate the noble Lord also on the persistent attempts to exploit politically the admitted disquiet of the National Farmers' Union at a certain stage of this Bill. There is one perfectly simple issue which arises from all three speeches to which we have listened. There is only one point, and that is that noble Lords on the other side of the House have this basic belief in control of our actions by Government. They are not the least impressed by the advance, as the noble Earl, Lord Waldegrave, mentioned, that agriculture has made during the last two years, with very little pressure from these powers of control, but as a result of education, advice and economic pressure, due to decreased recoupment.

LORD REA

Not all noble Lords on this side of the House take the line the noble Earl suggests.

EARL DE LA WARR

I accept the correction. I was referring to Her Majesty's Opposition. I make only one other point. Why should noble Lords on those Benches continually talk only of agriculture and farmers as needing this particular form of control? Farming is not the only industry in this country which receives assistance. It may receive assistance in a particular form different from that of other industries, but a multitude of industries are receiving a great deal of assistance in the form of tariffs and other ways and noble Lords opposite do not suggest that there should be control over all those other industries.

VISCOUNT ALEXANDER OF HILLSBOROUGH

That may be, but the noble Earl does not want to listen to the history on this point of the Party he has fairly recently rejoined. Not many years ago he was in favour of controls in agriculture. But, in any case, based on the 1920 and 1921 experiences which have been quoted again to-day by my noble friend, Lord Silkin, we have a very good reason for attaching controls where large sums of public money are necessarily spent for the support of an industry. The Party opposite has for years and years backed a large policy of high protection or tariffs for other industries with no guarantee of efficiency.

VISCOUNT MASSEREENE AND FERRARD

I can give the noble Viscount, Lord Alexander of Hillsborough. several instances which I personally have known of where members of agricultural executive committees have been extremely bad farmers themselves and the farmers in the neighbourhood have absolutely detested the agricultural executive committee because it has had people on it who have been quite unfit to have those powers. Powers of dispossession ought surely to be the prerogative of the Crown and should not be wielded by these jacks-in-office. I know of an instance where a friend of mine was being harried by the agricultural executive committee the whole time for inefficient farming. They told my friend that he must sack his bailiff. He was very loyal and said: "I cannot do that". But after a time he sacked him, and in six months' time this same man came back as an area supervisor. Really, it is quite incredible.

VISCOUNT ALEXANDER OF HILLSBOROUGH

I do not think a farmer welcomes the landlord any more than he does the agricultural advisory committee.

EARL WALDEGRAVE

I do not want to delay your Lordships, and I do not want to get into a Second Reading debate, but there are one or two points which I naturally must answer. The noble Viscount, Lord Alexander of Hillsborough, referred in his opening remarks to some organ of the agricultural Press which he had been reading and which was against this Bill. I took the trouble this morning to read the current numbers of the agricultural journals—I do not say all. because I do not know how many there are, but I read the well-known glossy-covered ones, at any rate. I was' interested to see that there was not a single comment about the going of this Part II of the Act. That has all died down in the agricultural Press, at any rate this week. That is a point I should like to make because the noble Viscount raised the question of the agricultural Press.

VISCOUNT ALEXANDER OF HILLSBOROUGH

I am afraid that that is not an answer to the fact that on July 1 —that is, this month—we received a strong submission against this proposal from the National Farmers' Union, whose support at other times you are only too glad to claim, and who were never consulted.

EARL WALDEGRAVE

I was not talking about the agricultural union but the agricultural Press. I will come, with permission, to this point about the National Farmers' Union, to touch on it very lightly. I do not quite know what noble Lords opposite are asking us to do about it. It is a strange doctrine if they are asking us always to listen to what the National Farmers' Union say and do it. It is very difficult. Of course, it is the Government's duty to hear and consider and weigh up. The only argument used is, "The National Farmers' Union said so, and why do you not do it?" If we are going into that, surely there was a very different atmosphere last March when this Bill was introduced from what there is now. I think there was a genuine misunderstanding then as to what had been the significance of the 1957 Act.

The argument is that if we repeal the second half we can repeal the first half. Of course that is true: we can repeal the whole Act. If we leave the second half, it does not make it less easy for another Government to repeal the whole Act. The initial fear of the National Farmers' Union was that they thought repeal was unnecessary. They seldom called it dangerous or harmful; they said it was unnecessary. They did not realise what the 1957 Act had done, and that is really the whole point. That has made the guarantees more secure than they were because it has put them on a longer-term basis, and that cannot be denied.

VISCOUNT ALEXANDER OF HILLSBOROUGH

This long-term guarantee to which the noble Earl refers is on a persistently downward basis.

EARL WALDEGRAVE

I do not think we can go into that. The point is you have got longer-term guarantees than you had before. The other question is a matter of opinion. The noble Lord, Lord Silkin, said it would have been perfectly easy to make the alterations to the organisation that flowed from our acceptance of the Franks Report. That is a matter of opinion; we did not think it would have been perfectly easy to alter the procedure. The noble Lord, Lord Wise, if I followed him correctly (I am not really sure that I did) asked whether the rules of good husbandry and estate management were repealed or not.

LORD WISE

The point I was making was that you had not repealed them. You had repealed Sections 12 to 20 but not Sections 1 to 11. If you were so concerned with repealing the second part, Part II, why did you not go the whole hog and repeal the whole lot? If you

Resolved in the affirmative, and Motion agreed to accordingly.

VISCOUNT ALEXANDER OF HILLSBOROUGH

Hear, hear, for the landlords!

Clause 2:

Amendments as to fixing of rents of agricultural holdings

2. In section eight of the Agricultural Holdings Act, 1948 (in this Act referred to as "the Act of 1948") and in section seven of the Agricultural Holdings (Scotland) Act, 1949 (in this Act referred to as "the Scottish Act of 1949"), the following paragraph shall he inserted at the end of subsection (1) (which enables the landlord or tenant of an agricultural holding to demand a reference to arbitration of the question what rent should he payable in respect of the holding)—

do not repeal them, how are you going to carry them out?

EARL WALDEGRAVE

Of course we do not want to repeal the rules of good husbandry and estate management. They are not only relevant to discipline and supervision; they are relevant to notices to quit, certificates of bad husbandry and all that. They remain on the Statute Book. I do not think I should delay your Lordships further on this matter.

On Question, Whether Clause 1 shall stand part of the Bill?

Their Lordships divided: Contents, 56; Not-Contents, 14.

CONTENTS
Hailsham, V. [L. President.] Crookshank, V. Hawke, L.
Davidson, V. Hemingford, L.
Buccleuch and Queensberry, D. Falmouth, V. Howard of Glossop, L.
Gage, V. Jessel, L.
Ailsa, M. Goschen, V. Lyle of Westbourne, L.
Lansdowne, M. Lambert, V. McCorquodale of Newton, L.
Lothian, M. Massereene and Ferrard, V. Mancroft, L.
Reading, M. Mersey, V. Merrivale, L.
Mills, L.
Albemarle E. Amherst of Hackney, L. Milverton, L.
Bathurst, E. Ashton of Hyde, L. Rea, L.
Bradford, E. Baden-Powell, L. Remnant, L.
De La Warr, E. Chesham, L. [Teller.] Russell of Liverpool L.
Galloway, E. Conesford, L. Saltoun, L.
Gosford, E. Derwent, L. Sandford, L.
Malmesburv, E. Digby, L. Strathcarron, L.
St. Aldwyn, E. [Teller.] Fairfax of Cameron, L. Strathclyde, L.
Swinton, E. Forbes, L. Swaythling, L.
Waldegrave, E. Hampton, L. Teviot, L.
Winterton, E. Hastings, L. Waleran, L.
NOT-CONTENTS
Lucan, E. [Teller.] Crook, L. Merthyr, L.
Greenhill, L. Ogmore, L.
Alexander of Hillsborough, V. Henderson, L. Pakenham, L.
Stansgate, V. Latham, L. Silkin, L.
Lawson, L. Wise, L. [Teller.]
Chorley, L.

"For the purposes of this subsection the rent properly payable in respect of a holding shall be the rent at which, having regard to the terms of the tenancy (other than those relating to rent), the holding might reasonably be expected to be let in the open market by a willing landlord to a willing tenant, there being disregarded (in addition to the matters referred to in the next following subsection) any effect on rent of the fact that the tenant who is a party to the arbitration is in occupation of the holding."

4.58 p.m.

LORD SILKIN moved, in the proposed new paragraph, to leave out all words after "effect on rent" and to insert instead: of a scarcity of holdings of a like character and area in the neighbourhood of the holding. The noble Lord said: The purpose of this Amendment is to alter the conditions required for the assessment of rent. The clause provides a new criterion for the determination of rent by the arbitrator, in that he is not to take into account the fact that the tenant who is a party to the arbitration is in occupation of the holding and is to regard a proper rent as the rent at which the farm may he expected to be let in the open market by a willing landlord to a willing tenant. The view we take is, first of all, that he ought to take into account the fact that there is a tenant in occupation—I think that that is a material factor. Secondly, we feel that in present conditions, with a great scarcity of holdings to let, an arbitrator ought to take into account that there is this scarcity and eliminate from what a willing tenant will pay to a willing landlord the element in the rent which is attributable to that scarcity.

We all know that at the present time, with this scarcity, many people are prepared to pay more than an economic rent. The noble Lord shakes his head; but, if he does not know it, I believe that most people know that to-day one can get considerably more than the economic rent for a farm in the open market, simply because people are prepared to pay and are not so much concerned with making profits out of the farm as with the amenity of renting a farm and being able to run it. Until such time as there is an adequate supply of farms in the market, we believe that the rent which a willing tenant pays is highly artificial, and it seems to us quite wrong that we should incorporate into an Act of Parliament such an artificial criterion.

This Amendment is designed to eliminate this artificial factor in the rent, the scarcity value, and to bring back into consideration the fact that a tenant is in occupation of the farm, and has been in occupation, and should receive some special consideration. I do not think it is unreasonable to expect that a tenant who is in occupation should be in a better position than a complete outsider to continue renting a farm. As the clause stands at the moment, if somebody comes along and offers £10 a year more than the present tenant is paying it would be possible to evict the sitting tenant because someone is prepared to pay more than he is paying. So the sitting tenant could be evicted and the farm let to a complete stranger. I should not have thought that it was in the interests of farmers that tenancies should be so easily changed. Therefore on both grounds—on the ground that some advantage should be given to the existing tenant and that the scarcity factor should be removed from the rent value—we feel that the criterion laid down in Clause 2 should be altered. I beg to move.

Amendment moved— Page 2, line 18, leave out from (" rent ") to end of line 19 and insert (" of a scarcity of holdings of a like character and area in the neighbourhood of the holding.").—(Lord Silkin.)

LORD WISE

My Lords, I rise to support the Amendment which my noble friend has moved, and I hope that in this instance Her Majesty's Government will really consider it very carefully and agree to put it into the Bill. This particular clause is a very difficult one so far as an arbitrator, at any rate, is concerned. It is within the memory of noble Lords that under the 1948 Act it is possible for either the landlord or the tenant to go to arbitration on rent. This particular clause introduces into agricultural legislation something which I believe has never existed before—a description of the basis on which the arbitrator should judge what the rent should be: that to be obtained in the open market by a willing landlord from a willing tenant.

One can understand what is meant by a willing landlord and a willing tenant, but my noble friend has referred to the hardship which may be caused to a tenant by reason of competition in the market for farms to let; and I believe that that position is very seriously affected now by the practice of going to tender in order to fix a rent and find a tenant. Obviously a penalty is imposed on the sitting tenant if he has carried out his obligations, for, by that good husbandry to which we referred a few minutes ago, he may have improved the farm as a result of being a good husbandman.

I believe it is undesirable that the rent of a farm should be increased, not only necessarily by improvements he is supposed to have made under the various Acts of Parliament already passed but by reason of the fact that he has been a good farmer and has put his wealth (if he has any) his skill and his labour into the farm and done it very well. For that reason I do not wish—nor do I think Her Majesty's Government should wish—that the good farmer should stand liable to be penalised for his efforts in regard to food production. I hope, therefore, that this Amendment will be accepted by Her Majesty's Government and that they will take note of what has been said by my noble friend about scarcity, because a rent may be fixed in relation to the scarcity of a particular type of farm in a particular area. I believe that is to be avoided, if possible, when we are trying to adjust rents throughout the agricultural industry so that they may be fair to both landlords and tenants.

EARL WALDEGRAVE

This Amendment would mean, of course, that the arbitrator would have to take account of the fact that a tenant was a sitting tenant, whereas it seems to us that the arbitrator must be asked to disregard that special feature. What would the arbitrator do if by Statute he had to do what this Amendment wants him to do and pay regard to that? It could be argued that a sitting tenant had special reasons for wanting to stay in a place. Perhaps he was born there and his children had been brought up there and he knew the good and bad points of the farm, and liked it there, and therefore he would pay more to stay there than others would be willing to pay. It is quite possible that if that were put into the Bill we should almost be telling arbitrators to put the rent for a sitting tenant at a higher level than for others. On the other hand, for reasons of sentiment such as I have given, an arbitrator might be led to take the view that the sitting tenant should have a lower rent. It is impossible to say which he might do. If there were no arguments against the Amendment on other grounds (although there are, and I propose to deploy them) I should have to recommend the House to reject this Amendment because of the confusion that it would cause.

There must still be some misunderstanding about this clause, and the noble Lord, Lord Wise, really gave point to that, for this clause has to be taken in its context. Some people seem to read it in isolation and thereby get it quite out of perspective, whereas in fact the words proposed in Clause 2 become embedded in Section 8 of the 1948 Act, which still stands on the Statute Book. There have been fears that with the instruction to disregard the fact that a tenant is in occupation the landlord would be able to increase the rent in respect of improvements which the tenant had carried out. I believe that was the point made by the noble Lord, Lord Wise. There is however, a complete safeguard against this in Section 8, subsections (2) and (4) of the 1948 Act, which will not be affected by this Bill.

Section 8 (2) requires an arbitrator not to take into account any increase in value due to improvements executed at the tenant's expense, and Section 8 (4) gives a broad definition of "improvement" in relation to farming of a more beneficial nature to the holder than that which normally could be expected. Section 8 (2), indeed, goes even further, and says that an arbitrator must disregard increases in value, even where the landlord has carried them out, when they are attributable to Government grant. Clause 2 does not require the sitting tenant to pay the full open market rent without qualifications. The qualifications are in Section 8 (2) and 8 (4), which are equivalent to the sitting tenant's claim to special consideration, but on an objective ground and not a subjective ground of sentiment.

The Amendment would also require arbitrators to disregard the effect of any scarcity of similar holdings in the neighbourhood. Apart from the difficulties of defining "holdings of like character and area in the neighbourhood". I can see difficulties in the definition. One of the factors affecting market value is always bound to be scarcity or abundance. There is no rent control in agriculture, and it is a false analogy to think of this problem in those terms. We are dealing here with the voluntary hire of a profit-making asset. People do not have to take farms; they take them only because they think they can make money and a living and a reasonable profit out of them. The facts of the case are that in nearly every case the highest offers are coming in from the most efficient farmers. That is my own experience, and I am sure it is the general experience; and surely we do not want any artificial set of rules which would weight the scales in favour of inefficient farmers.

A great deal has been said about wealthy hobby farmers who offer excessive rents. These hobby farmers do exist, I agree, but in nine cases out of ten—one might almost say ninety-nine cases out of a hundred—they do not seek to rent a farm; they seek to buy it: and nothing in this Amendment will stop that. I do not think that these hobby farmers come into this argument so much as some people are trying to make out. A landlord cannot reasonably expect to have a hobby farmer, and he will be out of definition there. These hobby farmers lack agricultural experience, and a willing landlord cannot reasonably be expected to let them a farm, for fear that they might let it down. We must remember that in discussing the whole of this clause and the Amendment we are dealing with arbitrations, where willing agreements have not operated; and I really do not believe we can use this hobby farmer argument to the extent to which it has been used.

Again, no one up to now has suggested that there is to be a sort of rent control for agriculture; or if they have, they are proposing a completely novel idea which would have to cover all rents and not simply arbitrated rents. All the Government are doing is trying to bring sitting tenants' rents into line with those of others. There is a gap—there is no doubt of that—and we are trying to close the gap from both sides. We feel that by easing up slightly, and with proper safeguards, the terms of the security of tenure provisions, there will be more farms on the market. The first person to like that will be the young farmer, the one who has been trained and who is longing to find a bigger supply of farms, so that he can get into the industry. We are trying to make the security of tenure provisions easier so that there will be a few more farms on the market. As soon as that position is reached, the premium will come down; and as soon as we get realistic arbitrations in the cases that go to arbitration, some of the lower sitting-tenant rents will go up, and the gap will be closed from both ends. I think that that is only right and that noble Lords want that position to come about.

There has been some misunderstanding about this matter. A very distinguished valuer who has been writing in the Press, Major Woolley, was in some doubt about these proposals, but now he has come out and said in this week's issue of the Farmers Weekly, something which is more relevant than what people said in March when they did not understand the clause. He admits that: The normal businesslike tenant well knows that fair rents are essential and that an estate should not have two levels of rents, one free economy rents on fresh lettings and others. Therefore I say that there is no good reason why a sitting tenant should be given a statutory right to a lower rent—and it was never intended that he should be under the 1947 Act; you have only to read the speeches concerning that legislation to appreciate that—except in so far as his own performance and the effects of Government grant entitle him to a lower rent. That position is unchanged. This Amendment would not make a clear impression on the arbitrator; it lacks precision. I do not want to be thought to treat this in any way lightheartedly, but the lines about the centipede really are relevant. The centipede was one day asked in fun, Pray, say which leg comes after which … Which raised his mind to such a pitch He fell distracted in a ditch Considering how to run. I think that if this Amendment were accepted the arbitrators would be put in rather the same position.

On Question, Amendment negatived.

Clause 2 agreed to.

Clause 3:

Amendments as to notices to quit agricultural holdings

3.—(1) There shall be transferred to the Agricultural Land Tribunal the functions conferred on the Minister of Agriculture, Fisheries and Food (in this Act referred to as "the Minister") by sections twenty-four and twenty-five of the Act of 1948 (which provide for the giving or withholding by the Minister of consent to the operation of notices to quit agricultural holdings) and by section twenty-seven thereof (which relates to the grant by the Minister of certificates of had husbandry for the purposes of notices to quit).

(2) The following subsection shall be substituted for subsection (1) of section twenty-five of the Act of 1948 (which requires the Minister to withhold his consent to the operation of a notice to quit an agricultural holding unless he is satisfied as to certain matters)— (1) The Agricultural Land Tribunal shall consent under the last foregoing section to the operation of a notice to quit an agricultural holding or part of an agricultural holding if, but only if, they are satisfied as to one or more of the following matters, being a matter or matters specified by the landlord in his application for their consent, that is to say— (b) that the carrying out thereof is desirable in the interests of sound management of the estate of which the land to which the notice relates forms part or which that land constitutes; or Provided that, notwithstanding that they are satisfied as aforesaid, the Tribunal shall withhold consent to the operation of the notice to quit if in all the circumstances it appears to them that a fair and reasonable landlord would not insist on possession.

5.19 p.m.

LORD WISE moved to leave out subsection (1) and to insert instead: (1) Where notice to quit an agricultural holding or part of an agricultural holding is given by the landlord to the tenant thereof and, not later than one month from the giving of the notice to quit, the tenant serves on the landlord a counter notice in writing stating a demand for arbitration in respect thereof, or matters arising thereon, then the same shall be referred to a single arbitrator in accordance with section seventy-seven of the Act of 1948; and in making his award the arbitrator shall consider, in addition to all information and particulars the parties may place before him, such matters as are specified by the landlord in his notice to quit in accordance with sections twenty-four and twenty-five of the Act of 1948 as amended by this section.

The noble Lord said: I look upon this as an Amendment of substance, and I hope that the Government will consider it in the same light. It is not put forward as any means of wrecking the Bill or anything of that sort, but rather to improve the procedure under the Bill. The drafting may be imperfect and carried out by an amateur; but if the Amendment is accepted then subsequent Amendments will naturally fall to be made. According to the Bill, all disputed notices to quit, whether for large or small farms, must be referred for the consideration of the Agricultural Land Tribunal. The Tribunal, within my knowledge, is already a very busy body; and the appointment of the Tribunal under this Bill is in the hands of the Lord Chancellor, who also is a very busy body—he is a very busy man, perhaps I ought to say—in regard to tribunal appointments and otherwise.

The Agricultural Land Tribunal appointed by the Lord Chancellor comprises a chairman of not less than seven years' standing who should be a barrister, a representative of the landowners and a representative of the tenants. On the hearing of cases, the chairman can call upon two professional assessors to assist in the consideration of the case, but the decision is entirely in the hands of the tribunal, and I am rather inclined to think that the chairman, who is a lawyer, may possibly have to act sometimes as umpire between the two other members of the tribunal. I think it is obvious that in regard to agricultural notices to quit the tribunal may in most cases have to consider matters of fact and not matters of law. What I am asking for is that all matters arising from notices to quit should be referred to a single arbitrator, appointed from a panel of experienced practical agricultural experts. The noble Lord has just paid a little tribute to the man who knows his agriculture as against a man who is a hobby farmer, and the same applies in this respect. The panel should be comprised of agricultural experts not merely of seven years' standing in their profession but possibly twice or even three times that number of years' standing before they are appointed to the panel of arbitrators.

Your Lordships will notice in the preceding clause which we have just passed that rent is a matter for a single arbitrator, and there are other matters arising in agriculture which are dealt with by professional valuers and others of experience singly, without any assistance whatsoever. It is customary to call in agricultural valuers, acting on both sides, certainly, in regard to tenant right valuations, and then, if there is a dispute between those valuers, then the matter goes to a single arbitrator. Sales and valuations of farms and estates are carried out by single professional men. The choice of tenants is a matter which comes under their purview very often, as does the terms of agreements, damages to game and stock, and such like, and general advice on all farming practices, including very often disputes between neighbours. In considering the status of these people and the matters to which they have to give their attention, why should we not put the matter of a notice to quit under their jurisdiction rather than under a legal body? I have referred to the qualities and qualifications of these agricultural valuers and arbitrators, and the reputation which a man must hold before he is appointed to the panel as an abitrator or an umpire must be very high.

There is another question which I want to raise in order to help me in my argument as to why we should pass this particular matter over to a single arbitrator, and that is the question of expense. One knows that these cases before the Agricultural Land Tribunals are very often delayed and that heavy legal expenses are incurred, because it is almost invariably necessary to employ legal assistance. The costs of the general run of agricultural valuations and arbitrations are on a much lower scale than those in regard to which one has to obtain legal advice. As this clause envisages, and as I said earlier on, not only small farms but large farms will come under the jurisdiction of the Agricultural Land Tribunals. I think it is obvious that at any rate the small farmers would gain very materially in regard to costs if the matter was referred to a single arbitrator. I am inclined to think that at the moment there are too many tribunals. We seem to be governed to a very large extent in this country by tribunals and such like, and if we can relieve the Agricultural Land Tribunals of some of their work (which may be work that other people could do equally as well) then I think it would be an advantage.

I ask for the consideration of the Government in regard to my Amendment, and I ask noble Lords on the other Benches who are connected with farming and farming estates to back me up in my plea that agricultural matters such as we have to go through should be dealt with by practical agricultural experts rather than by a body of which the chairman is a member of the Bar. I beg to move.

Amendment moved— Page 2, line 20, leave out subsection (1) and insert the said new subsection.—(Lord Wise.)

5.27 p.m.

EARL WALDEGRAVE

I fully realise that this is not intended by the noble Lord, Lord Wise, to be a wrecking Amendment and that it is of substance. I wish I could help him about it, because he has marshalled his arguments fairly and skilfully, but I do not think I can recommend your Lordships to accept this Amendment. I will be as brief as I can, but as this matter has been raised we must. I think, discuss for a moment what is the difference between an arbitrator and a tribunal, and their relative merits.

In comparing the relative merits of giving these functions of adjudicating on notices to quit and certificates of bad husbandry to a tribunal or to an arbitrator, the first point I should like to make is that the decision in these cases is not only of vital importance to the parties and to the future of the holding, but involves a considerable element of personal judgment. In our view, it would be unwise to allow such an important decision, involving a degree of personal judgment, to rest with a single person. Where personal judgment comes in, three heads are sometimes better than one. I think it is generally accepted that the Agricultural Land Tribunals over the past ten years have done a good job on appeals in this class of case. The Franks Committee reported that they appear to be generally regarded as satisfactory". As the noble Lords opposite know, they are composed of a legal chairman, a farmer and a landowner. That is a very strong combination, and their composition appeals strongly to the farming community, who have always supported the principle that farmers and landowners should be "judged by their peers".

It is perfectly true that the Agricultural Holdings Act, 1948, gives agricultural arbitrators very important duties, and I am not saying that the contrary is the case. I have had a complete schedule of all the functions of arbitrators on the one side and of tribunals on the other before me when considering the noble Lord's Amendment, and when one comes to consider the issues which are presented to these two kinds of judges one finds that on the whole arbitrators are asked to judge on issues of fact. Though, of course, that calls for professional judgment, and professional judgment of the highest order, it does not call for personal judgment in quite the same way, for example, as is called for when the decision is whether a landlord is being fair and reasonable.

The noble Lord referred to the question of expense. It is said sometimes that cases that go before Agricultural Land Tribunals are more expensive to the parties, but I doubt whether there is very much in that, because an arbitrator is entitled to a fee, whereas the tribunals do not impose fees or court costs. In both cases it is up to the parties to decide whether they want to be professionally represented. and that is what will control costs. A tribunal of course, can award costs, against a party who acts frivolously or vexatiously in bringing a case before them; but I do not think there is much in that. For the reasons I have given, I am confident that the Agricultural Land Tribunals are the best people we can find to determine these cases. I hope that, on reflection, the noble Lord will agree to withdraw his Amendment, because I could not recommend your Lordships to accept it.

LORD WISE

In view of what the noble Earl has said and of the fact that I did not expect, at any rate under this Bill, to get the point I put before your Lordships—though at some time I may be able to convince your Lordships that the agricultural arbitrator is a man who can carry out the work of the Land Tribunal with great efficiency and to the satisfaction of the parties—I beg leave to withdraw my Amendment.

Amendment, by leave, withdrawn.

5.33 p.m.

LORD SILKIN moved, in subsection (2), in the proposed new subsection (1), to leave out paragraph (b). The noble Lord said: I can deal with this Amendment briefly because the question it raises was discussed on Second Reading. Subsection (2) sets out the circumstances in which a landlord can give notice to his tenant and the factors which have to be taken into consideration before the Minister can give a certificate permitting eviction. One of them is that the Agricultural Land Tribunal shall be satisfied that the carrying out thereof is desirable in the interests of sound management of the estate of which the land to which the notice relates forms part or which that land constitutes;

In the first place, I want to use the argument which the noble Lord used against the Amendment which I last moved—namely, that this would be a very difficult thing to operate. The criterion is so vague and difficult to decide upon, that the Tribunal would have as much difficulty in determining what is "desirable in the interests of sound management of the estate" as it would have in deciding what is the scarcity value to be attached to land. If that was a good reason for rejecting a positive Amendment, I should have thought it applied equally here, be- cause the wording of this condition is even vaguer and more difficult to ascertain.

I would go further. Apart altogether from the difficulty of determining what is "desirable in the interests of sound management"—and that may mean all sorts of things—I would say that it is unfair to the tenant and calculated to deprive him of a certain amount of security. I have never said that we stand for giving tenants complete security; nor, incidentally, have I said that we stand for the crystallisation of the rent that they are paying at present. We on this side of the Committee have always recognised that there are circumstances in which a landlord is entitled to a greater rent, and circumstances in which he is entitled to possession. Therefore, we are not in disagreement about the necessity for having a provision which would give a landlord an opportunity of getting possession in certain circumstances. What we do say is that we do not think that the landlord ought to get possession merely because it is desirable in the interests of sound management of the estate of which the land to which the notice relates forms part or which that land constitutes; …

We feel that we have to hold a balance between landlord and tenant. I take it that we are still concerned with the interests of good farming and not with the pure landlord-tenant relationship. We feel that to import this paragraph into the Bill as a ground for getting possession is unfair to the tenant. He might be a perfectly good tenant, farming the land extremely well, and yet, through no fault of his own, merely because the landlord thinks it desirable in the interests of sound management of the estate "he might be evicted. I do not even suggest that there may not be circumstances in which it would be right, for the improvement of an estate as a whole, that a tenant should be asked to go; but in my view the provision ought to be far more specific than this paragraph (b), which is so vague that almost any landlord can make out a case that eviction would be "desirable in the interests of sound management".

It is clearly understood that one can always make a case for a larger holding by arguing that combining land which constitutes the tenancy with a bigger area creates a more efficient unit. A man may be farming 50 acres which forms part of a holding of, say, 500 acres. It is the easiest thing in the world to make the case that "in the interests of sound management" the 50 acres should be incorporated in the 500. It almost goes without saying. Yet I am sure that we should not wish to give a landlord possession and evict a satisfactory tenant on that ground alone. I hope that this is not the intention of these words in subsection (2) (b). If the Government really attach importance to some provision which would enable a landlord to get possession in circumstances of this kind, I submit that they ought to define it more clearly and definitely, first of all, so that the Agricultural Land Tribunal which would decide this type of case would understand the exact test they have to apply and not use this vague test; and, secondly, so as to limit the opportunities of a landlord to get possession to those where it is definitely desirable in the public interest. I hope, therefore, that the noble Earl will be able to give a promise that he will look into the wording of this paragraph with a view to making it more clear and definite and to limiting its application. I beg to move.

Amendment moved— Page 2, line 45. leave out paragraph (b).—(Lord Silkin.)

LORD WISE

I hope the noble Earl will take note of what my noble friend has said and will reconsider this subsection. It seems to me to be a re-writing of Section 25 (1) of the 1948 Act, and possibly makes it even more difficult than that provision. In the 1948 Act the expression "good estate management" is used, and I think it is a pity to introduce into this Bill the words "sound management" rather than the words to which we have been accustomed since 1947. As my noble friend has said, it will be difficult to define what is desirable under this paragraph. and I therefore hope that the Government will at any rate reconsider the wording, even if they cannot dispense with paragraph (b) altogether.

EARL WALDEGRAVE

Perhaps I might reply first to the noble Lord, Lord Wise, because he has raised a point that I think can dispose of straight away. He has asked why we do not use the well-known phrase "good estate management", and why we have imported the phrase "sound management". The answer is because (though I think what we are now defining as "sound estate management" is what "good estate management" was intended to be in the 1947 Act) the courts, as so often happens in these cases, have limited the provision and made it mean, by judgment, something which we did not think it meant. "Good estate management has come to be limited to the provision of conditions which will enable the occupier to maintain production; and, secondly, it has come to be limited by court decisions to the land subject to the notice and not to the estate as a whole, which was never intended. That is why we use these other words.

The noble Lord, Lord Silkin, asks: "Why do you import this into the Bill?" But his Amendment would take the whole of the estate management, good, sound or whatever adjective you put in front of it, out of the 1947 Act altogether. We are repealing nothing. We are including paragraph (b) to bring the position up to date and within the law, so that it will work as it was always intended to work. The Amendment, as drafted and as put down, would make it impossible for a landlord to gain possession of a holding on estate management grounds. I cannot understand how that could be held to be desirable, especially by those who say they believe that the 1947 Act should not be touched at all. A good estate is not merely a collection of holdings; it must be looked at as a whole, and there are many cases where notices to quit for the purpose of reorganisation of farm boundaries and the amalgamation of uneconomic holdings is in the general interest of agriculture, and in the long-term interests of the tenants.

Statements have often been made by leading spokesmen on both sides about the virtues of consolidation of holdings of this nature. But this Amendment would relegate the whole of those amalgamations to the class of pious aspirations. It would be far more restrictive than the provisions existing under the 1948 Act, which allow a tenancy to be terminated if this is in the interests of good estate management of the holding concerned. Therefore, it would be an even greater departure from the intentions, as we understand them, of the 1947 and 1948 Acts. It was a decision of the courts which confined the meaning of the phrase "good estate management" to the management of the land covered by notice to quit. It had been understood, when the 1947 and 1948 Acts were before Parliament, that the whole estate would be taken into consideration.

There is another important point. This Amendment would run counter to the agreed intentions of both sides of the industry. Clause 3 represents an agreement in terms between the Country Landowners' Association and the National Farmers' Union, and I could recommend your Lordships to accept an Amendment only if there were the most compelling reasons. I do not see them here.

The noble Lord, Lord Silkin, raised this matter on Second Reading, when he said that any landlord could seek eviction on vague grounds of sound management. I think the noble Lord may have overlooked two important points. The first is the importance of the proviso which requires the Tribunal to withhold consent if in all the circumstances it appears to them that a fair and reasonable landlord would not insist on possession. That proviso (perhaps I did not stress it enough in my Second Reading speech) is overriding of the whole matter. It requires the Tribunal to do this, and in this respect is, from the tenant's point of view, an advance on the discretion given to the Tribunal under the present law, because the Tribunal is not obliged to use that discretion. It is quite clear to me, and I hope that it will be clear to your Lordships also, that the Tribunal must inevitably reject any vague proposals and any schemes which they consider to be a mere cover for some other purpose, since no reasonable landlord would seek to evict a tenant on these grounds unless he had a sound, genuine and workable scheme ready to put into operation.

The other safeguard against abuse which may have been overlooked is that to be found in paragraph 13 of the First Schedule, the penal clause. There the landlord is subject to a penalty of up to two years' rent, in addition to the rent he must pay as compensation for disturbance. I think there would be few landlords, however unscrupulous, who would be prepared to put up a false argument and then not carry out what they have alleged they would carry out and pay compensation of two years' rent to the tenant and another two years' rent as a fine. That is a fairly heavy fine. Incidentally, on other points in Clauses 2 and 3 of the Bill, it is a good reason why a tenant (if there be any) who fears an unscrupulous landlord is much safer with a realistic rent than with some of these nominal rents that existed in the past: he knows that if his landlord does play any tricks of that sort on him the fine will be really substantial. I feel therefore that paragraph (b) is a useful and necessary part of the clause, and I would urge your Lordships to reject the Amendment.

LORD SILKIN

I am sorry to say that the noble Earl did not do himself justice on this Amendment. He spent most of the time criticising the terms of the Amendment. I hope I am not saying anything that is incorrect, but certainly since I have been in this House it has been traditional not to be too particular about the exact words of an Amendment. We have no expert draftsmen on this side of the House. We have to do it in our leisure time on a Sunday afternoon, when we should be much more happily engaged in other activities, and we do our best. It is always open to criticism. Anybody can stand up and criticise the wording of an Amendment; and possibly it is capable of being criticised. But I suggest to the noble Earl that it is not right to spend the greater part of his time in replying by criticising the wording, or the way in which this Amendment has been prepared.

EARL WALDEGRAVE

I should be very sorry indeed if I had shown any discourtesy to the noble Lord, and certainly none was intended. I do not think anyone reading Hansard would feel that I was doing that in this case. This is not a question of the words of the Amendment, which simply says "leave out paragraph (b)." There is no wording there that I am arguing about. I am arguing about what would happen if we deleted the paragraph.

LORD SILKIN

But the noble Earl did not take account of what I asked him to do towards the end of my speech. In form, of course, I regard this paragraph as an objectionable paragraph. Nevertheless I think that something ought to be put in its place. I have not drafted what should be put in its place, but I indicated the sort of thing which I think would be acceptable. I expressed the hope that the Government would be prepared to look at this paragraph again and see whether something could be put in its place which would be acceptable.

I gave my reasons why I thought this particular paragraph, as it stood, was not satisfactory. I had hoped that the noble Earl would have directed himself to that point. I think it is vague and goes too far, because it enables any landlord to come along with a legitimate scheme, if you like, on the ground of sound management of the estate, which would no doubt improve the profitability of the land from his point of view, but not from an agricultural point of view.

As this clause stands, for instance, a landlord is under no obligation to improve the land from the agricultural point of view. He can come along with a scheme in the interests of sound management. He could even produce a scheme for bringing industry on to the land, and certainly from his own point of view of sound management it might be highly desirable, and it might even be desirable in the public interest. But the criterion ought to be the public interest, and not the interest of the individual landlord himself. In other words, what we are objecting to is that the landlord should be able to get an eviction order against a tenant merely because he can make a more profitable use of the land and not necessarily because the alternative use of the land would be in the public interest.

I hoped the noble Earl would be willing to look at that point again. He has made an alteration from the terms of the 1948 Act. Is he quite sure that the alteration he is proposing to make really meets the case? Is he sure it does not go too far? If he would be prepared to give an assurance that he would look at it again with his friends, I would be quite prepared to drop the Amendment. But I think it is worthy of being looked at again in the light of what I have said.

VISCOUNT GAGE

I should like to support what the noble Lord, Lord Silkin, has said. I am an owner of agricultural land and have every reason to try to protect my own interests. At the same time, it seems to me that these words are a little vague, and it may be that when they are interpreted by tribunals they could be given a meaning which may not be entirely acceptable to the owner as well as the tenant. These questions of drafting are always difficult, but I should have thought it was worth looking into again.

LORD HASTINGS

I listened very carefully to what the noble Lord, Lord Silkin, said, and also to the noble Earl. I must say that I feel perhaps the noble Lord opposite was a little unfair. I feel that the noble Earl, Lord Waldegrave, replied fully to the Amendment. He explained in great detail the precise meaning of the words, "sound management of the estate ",and explained why it has been necessary to depart from the old expression," good estate management "because in the courts that expression had not really complied with the original intention of the Act.

The noble Lord, Lord Silkin, complained particularly, I think, that a landlord might put up some scheme not connected with agricultural improvement. I would direct his attention to paragraph (e) where that possibility is referred to: … the land's being used for a use, other than for agriculture. … That, presumably, would apply to the establishment of industry, a building estate, or something like that. I should have thought that noble Lords opposite would have preferred to follow that paragraph rather than paragraph (b), which, it seems to me, meets the general case for the improvement of the agricultural aspect of land management much better than any other words that could be found. I do not entirely agree with my noble friend Lord Gage that these terms are too vague. I feel that noble Lords opposite do not seem to have enough confidence in the Land Tribunal.

VISCOUNT ALEXANDER OF HILLSBOROUGH

Landlords.

LORD HASTINGS

The Land Tribunal, if you please. I am not going to argue as to the excellence of landlords, but the Land Tribunal is to be charged with these matters. I am quite sure, for instance, that they would not agree to a 50-acre farm being tacked on to a 500-acre farm. That is no particular improvement. The man with 500 acres does not need it, and no reasonable landlord would insist on possession in that case. But if it were a question of amalgamating two or three small holdings which were uneconomic, whose tenants were clearly not able to pay their way, and whose buildings were probably beginning to fall down, then that is possibly a legitimate case for improvement of the estate and the sound management of the estate. I can think of other quite logical matters which could be dealt with under this clause.

VISCOUNT ALEXANDER OF HILLSBOROUGH

We always felt that this kind of policy was based upon the survival of the fittest and the weakest to the wall. We are confirmed in it.

LORD HASTINGS

I am sure that if the noble Viscount was a landlord of an estate—perhaps he is; I am not sure—where these problems arose, he would not misunderstand me. But it is quite clear in some cases—I am not saying that tenants should be evicted, but when tenants come to the end of their life—that there should be an opportunity for making amalgamations which are in the interest of future tenants and the management of the estate itself. I would ask noble Lords opposite to believe that this matter can be left safely in the hands of the Agricultural Land Tribunals.

LORD SILKIN

The noble Lord has just given the best argument for looking at this clause again.

EARL WALDEGRAVE

I am sorry, but I cannot accept this Amendment, and I do not think it would be fair for me to say that we would consider it again, knowing, as I do, what answer I should have to come back with. I want to give just these three reasons for this. First of all, I am absolutely sure that Lord Silkin's fears on the one point are unfounded. I am sure that the tribunal must reject these vague proposals. That is the first point. Secondly, we heard a good deal earlier this afternoon about listening to the National Farmers' Union. This whole subsection has had a tremendous amount of work and thought put into it and the National Farmers' Union and the Landowners' Association have been consulted. It would have to go back again if it were radically changed. Thirdly, I think we are overlooking that the whole of this is topped and tailed with this proviso; everything that happens under Clause 3—paragraph (b) is no exception—is subject to the proviso, which I have underlined in red in my copy because people keep forgetting it: Provided that, notwithstanding that they are satisfied as aforesaid, the Tribunal shall withhold consent to the operation of the notice to quit if in all the circumstances it appears to them that a fair and reasonable landlord would not insist on possession. That is a tremendous safeguard and must not be overlooked. The fourth point is, do not let us forget the very substantial penalty for abuse which is contained in the Schedule. Therefore I cannot recommend your Lordships to accept this Amendment.

VISCOUNT ALEXANDER OF HILLSBOROUGH

We thought we might have saved the House the trouble of dividing again. You have been given the opportunity for thinking it over before Report stage. But the unrelenting attitude on the basis of the words quoted leaves me quite cold. The proviso speaks of "a fair and reasonable landlord". This is to be the basis of interpretation of some tribunal. On what grounds, what experience? We do not know who they will be or what experience they will have of this kind of thing. Nobody in any statutory or judicial position has ever given a reasonable interpretation of the word "reasonable". I can refer you to all kinds of stories about that, but I will not bother—read some of the Committee's Report on Trusts and Combines in 1919–20 and you will see what I mean. The noble Earl must give us the chance of thinking again before the Report stage, otherwise we shall divide now or on Report.

On Question, Amendment negatived.

6.4 p.m.

VISCOUNT FALMOUTH moved, in subsection (2), in the proposed new subsection (1), after paragraph (e) to insert: (f) that notwithstanding the provisions of the proviso to this subsection, the land referred to was the subject of a lease to a company or corporation entered into before the Act of 1948, and the term shall have expired within a month before the notice to quit shall have been served by the landlord, or was the subject of a year to year tenancy with a company or corporation entered into before the said Act: The noble Viscount said: The object of this Amendment is to remove a serious injustice that has arisen as a result of the passing of the 1948 Act. I do not suppose the Government of the day, the Labour Party, wished to create a special class of privileged tenants, and possibly the matter was overlooked by them at the time. But the result of the passing of the Act is that when farms are let to companies those companies are placed in a privileged position relative to all other tenants, for a company never dies.

A landowner who let a farm to a company before the passing of the 1948 Act, say for a period of fourteen years, did so in the firm belief that at the expiration of that time he would be able to regain possession, if he so desired, subject to the payment of compensation for improvements and so on. A landlord who did this in perfectly good faith now finds himself in a hopeless position. For never can he regain possession of the land, because as I have said, a company never dies. He may want the land to farm himself, or for a member of his family who has now grown older and suitable to farm land; he may want to amalgamate it with another part of the property or to let it, perhaps, to another tenant. But as I have said, he can never sere notice to quit as the company can ask the Minister to declare the notice null and void and the company can continue for ever on a year-to-year basis, subject to the rules of good husbandry. This class of privileged tenant can go on for ever unless the company is wound up, which of course is very unlikely to happen with a large company managing an agricultural property. If a landowner lets his property to a company subsequent to the passage of the 1948 Act, he does so with his eyes open; he knows the position, and probably in the result very few landlords, if they are wise, will ever in future let their land to a company.

This question of the creation of privileged tenants has occurred from time to time in our history. In the reign of Edward I the monasteries enjoyed great privileges as tenants by reason of their undying status. It was very injurious to the King and the landlords of that period. In order to remove the dead hand the famous Statute of Mortmain was passed to put I he matter right. If you substitute the word "company" for "monastery" in the Statute of Mortmain you will see that my Amendment is very much the same and seeks to remove an injustice which to-day corresponds to the experience in 1300. I beg to move.

Amendment moved— Page 3, line 13, at end insert the said new paragraph.—(Viscount Falmouth.)

EARL WALDEGRAVE

This Amendment raises very difficult issues—there is no doubt about that. In its favour, I agree that a landlord who has let to an individual can count on being able to recover possession, when his tenant dies, under Section 24 (2) (g) of the 1948 Act, and Clause 6 has been introduced into this Bill to make the same hold good for Scotland. I agree also that a landlord who has let to a corporate body cannot take advantage of this provision because the corporation is never going to die. This is a serious matter for the landlord who may well be deprived of any opportunity whatever of getting possession of his own property. One is bound to feel certain sympathy for the view that this is rather harsh. On the other hand, it is important not to exaggerate the landlord's disability. Remember that he will still be able to recover possession if he can make out a case on any of the other grounds set out in Clause 3 of this Bill or in Section 24 of the 1948 Act. For example, he can turn his tenant out if he can show that it is in the interests of efficient farming or sound management, or that greater hardship will be caused, subject all the time to the proviso. He can also turn his tenant out under Section 24 on grounds of breach of covenant or on the ground that the land is wanted for a non-agricultural use. In short, the landlord's power to gain possession in the interests of the holding is the same whether the farm is let to an individual or a corporate body. It cannot therefore really be said that he is more likely than others to lose on his investment so long as the farm remains let.

Again, from the agricultural standpoint there is good reason for enabling a landlord to regain possession on the death of a tenant. The tenant's successor may be unacceptable; he may not be a farmer at all. So long as the tenant himself is protected from eviction the agricultural purposes of the security of tenure—to give him confidence to plan ahead and to farm well—are, we consider, sufficiently guaranteed. The advantage to agriculture therefore lies in the landlord's freedom to select the next occupier, when the occupier is an individual. But the advantage to agriculture is not so clear with a corporate tenant as I have tried to show. For this reason this Amendment cannot be regarded for corporate bodies as the exact equivalent of the existing provisions about the death of individuals. I do not want to criticise the noble Viscount on drafting, but it is a fact that, as the Amendment is drafted, all tenants under tenancies created before 1948 would have to farm in continual uncertainty, knowing that they might receive an uncontestable notice to quit at any time. Surely that is not desirable.

I feel that I must also say something else in this connection—I hope my noble friend will not think that I am merely criticising the drafting of the Amendment. Another reason why we could not accept it as it stands is that there is another kind of body which would also be affected by this Amendment. My noble friend was probably thinking of joint stock companies, but there are, for instance, 27,000 acres of agricultural land let to county councils in their capacity as smallholding authorities. I do not think that my noble friend would wish to deprive them, and in turn their sub-tenants, the smallholders, of all security of tenure. Yet this Amendment would tend to produce that effect. The argument that landlords never will let to a company is not really covered by this Amendment, because it refers only to pre-1948 tenants. I think your Lordships will recognise, in view of what I have said, that this matter needs careful thought. It may be that we can find a formula which would meet the specific point that has been made by the noble Viscount, Lord Falmouth, without damage to the agricultural interests.

There is one other and most important point that I must raise—namely, that the changes which we propose in this Bill in regard to security of tenure were the result of an agreement between the Country Landowners' Association and the National Farmers' Union, and I think the noble Viscount will agree that any further change must proceed on the basis of thorough consultation with the two sides of the industry. If the noble Viscount will withdraw his Amendment now. I will gladly undertake that my Department will give this matter careful further study, with a view perhaps to including a suitable Amendment in an Agriculture (Miscellaneous Provisions) Bill or otherwise at some future date, if an acceptable solution can be found to the difficulties I have tried to outline.

VISCOUNT FALMOUTH

In view of the statement made by the noble Earl in charge of the Bill, I beg leave to withdraw the Amendment.

VISCOUNT ALEXANDER OF HILLSBOROUGH

I would only say that it is quite a piece of progress to get the noble Earl promising at least one of his own side that there will be consultation before Report. We are most grateful that at least the National Farmers' Union and the Country Landowners' Association are promised consultation.

Amendment, by leave, withdrawn.

6.15 p.m.

LORD WISE moved, in subsection (2), to add to the proviso: or that greater hardship would be caused by consenting to operation of the notice to quit than by withholding such consent.

The noble Lord said: On behalf of my noble friend Lord Silkin I beg to move this Amendment. Now we come to the rather famous proviso which the noble Earl mentioned in a previous speech that he had underlined in red ink. The object of this Amendment is to enable the tenant to receive greater consideration in regard to notice to quit. The Committee will see in the proviso that the Tribunal are given definite instructions as to what they may consider, or what they may do if they consider that a fair and reasonable landlord would not insist on possession. We wish by this Amendment to give the Tribunal a further instruction by inserting at the end of the proviso the words: or that greater hardship would be caused by consenting to operation of the notice to quit than by withholding such consent.

The Committee will notice that earlier in subsection (2) there is a provision given to the landlord whereby he may insert in his notice to quit the fact that greater hardship would be caused by withholding than by giving consent to the operation of the notice. If you grant to the landlord the right to give as a reason that withholding would create greater hardship than by giving consent, then I think that the same should apply to the tenant, and that these words should be inserted at the end of the proviso.

If the Committee will refer to Section 25 of the 1948 Act, it will be noticed that this particular subsection differs not only in regard to the wording itself but through the inclusion of other subsections which are not in the 1948 Act, and the hardship subsection is one of those which has been included. In fairness, it would be difficult for the Tribunal at any time to decide in their minds what a fair and reasonable landlord would do, but it is obvious from those words that they will have ruled out the landlord who has sent in the notice to quit, because, obviously, if he is a fair and reasonable landlord he would not have sent the tenant the notice to quit. The Government are helping to protect the landlord by this clause; I hope that they will also protect the tenant. I agree with my noble friend Lord Hastings that there are some very good landlords in Norfolk and elsewhere, and hope that we may think them all fair and reasonable to their tenants so far as notices to quit are concerned. I hope that the Government will help us in this matter, and that at long last they will accept one of our Amendments. I beg to move.

Amendment moved— Page 3, line 18. after (" possession ") insert the said words.—(Lord Wise.)

EARL WALDEGRAVE

I am sorry to disappoint the noble Lord, Lord Wise, after the careful way in which he has put forward this Amendment, but I really could not accept it. Let us see what he is asking us to do. He is asking us to make hardship an overriding factor in the decision of all notices to quit. After all, we heard earlier this afternoon from the noble Viscount the Leader of the Opposition that no matter how badly a tenant was farming, no matter—

LORD WISE

May I just interrupt the noble Earl? You say that you are making hardship the overriding factor.

EARL WALDEGRAVE

I am not doing so, but your Amendment would.

LORD WISE

But in paragraph (d) of subsection (2) (1) you are already making hardship an overriding factor on behalf of the landlord if he serves his notice to quit.

EARL WALDEGRAVE

No, that is not quite an accurate interpretation of the Bill. Hardship is one of the grounds for giving a notice to quit and hardship can be pleaded. If the landlord pleads hardship the tenant can plead hardship back again. This Amendment, however, would require the Tribunal to refuse consent wherever greater hardship would be caused by giving than by refusing consent; and that means that where notice was given in the interests of good husbandry or of sound estate management, or whatever the ground might be, and whatever the Tribunal thought, if the tenant chose to put in the word "hardship" and could prove that he was going to suffer hardship—as everybody must—then the whole thing would be overridden.

This Amendment would alter the whole meaning and purpose of the security of tenure provisions, for the purpose of those provisions was not, and is not, to give tenants a life interest in the farms they occupy. These provisions were introduced because it is impossible for a tenant farmer to plan ahead and farm properly without reasonable confidence in his security, if he does his business properly. The noble Lord shakes his head, but I really think that that is, and must be, what security of tenure was intended for. If it is said that security of tenure is simply to give the tenant the freehold without his having to pay for it, surely that was not intended nor could it be done. The primary purpose of all security of tenure provisions is efficiency in agriculture, and that is why Her Majesty's Government could not accept an Amendment which would be an overriding blanket and would say that, however inefficient the farming may be, where there is hardship the tenant does not have to go. That could not be. Neither farmers nor landowners want the provision extended in that way.

The legitimate claims of tenants are already adequately covered by the existing proviso which requires the Tribunal to refuse consent if, in all the circumstances, a fair and reasonable landlord would not insist on turning out the tenant. Agricultural landlords are not slow to acknowledge their responsibilities as well as their rights, and many of them—I believe most of them—have established a sound tradition of decent behaviour. I am sure that a tribunal (and here it is a tribunal and not a single arbitrator) including among its members (as it must) a farmer and a landowner, will have no difficulty in deciding, in cases like this, what a fair and reasonable landlord would do in the circumstances of any case. He would be anxious to avoid acting unnecessarily harshly, but he would recognise that in some circumstances his responsibilities to the land in question, and to the estate—perhaps even to his family—might require him to end the tenancy, even at the cost of some hardship to the tenant. We cannot work this world without a little pain and difficulty in some cases.

In short, we believe that our proviso is a sufficient safeguard. It has the agreement of both the landlords' and the farmers' sides. The Amendment, on the other hand, would make the hardship to a tenant the overriding consideration and turn the new security of tenure provision from an essential base of efficiency into a cover for bad farming. I am afraid that that would be the effect and that in this way it would defeat the object of the subsection; for that object is to bring to an end a situation in which the security intended for the good tenant farmer has—contrary to the original intention—been given to the bad farmer; and I am afraid I must strongly recommend its rejection.

VISCOUNT ALEXANDER OF HILLSBOROUGH

I am bound to say that no one on this side of the House would be convinced by such an argument. Paragraph (d) which was quoted by my noble friend in the interruption just now gives as one of the grounds: that greater hardship would he caused by withholding than by giving consent to the operation of the notice ", and there is therefore, as the clause now stands, a distinct bias in favour of the landlord who is giving notice. The noble Earl merely says, "But the tenant can plead hardship in return." That is not the point we are arguing. If it is left as it is, the alternative is given to the Tribunal to decide that there would be hardship against the landlord; but there is no provision in this proviso to the same extent on behalf of the tenant. That is our case.

When we listen to these expositions of what is fair and reasonable to be submitted to the Tribunal we come back again to the interpretation of "reasonable" as given to the Standing Committee on Trusts. They quoted the case of the publican and the painters. They quoted the painters as saying to the publican, when questioned, that the beer supplied to them would not have been theirs at all if it had been any better; and that if it had been any worse they could not have drunk it. If that is the kind of basis on which they want "reasonable" interpreted in relation to the tenant, who at present has reasonable terms of security, then I do not think Her Majesty's Government have very much to stand on. Let them take out paragraph (d) if they like and leave the tenant fair and square; or else give us the addition to the proviso which will put the tenant in an equitable position in relation to the landlord whom Her Majesty's Government are protecting by this clause.

On Question, Amendment negatived.

Clause 3 agreed to.

Clauses 4 to 6 agreed to.

6.26 p.m.

THE MARQUESS OF AILSA moved, after Clause 6 to insert the following new clause:

Creation of contractual leases by agreement

" .—(1) Notwithstanding anything contained in this Act or in any other enactment it shall be competent for the landlord and the tenant of any agricultural holding to which this section applies by agreement to enter into a lease of the holding for such period not being less than fourteen years and with such break or breaks in the said lease as may be mutually agreed upon between the landlord and tenant.

(2) The provisions of section five of the Act of 1949 (which relates to the respective liabilities of landlord and tenant for fixed equipment and insurance premiums) shall apply to any lease entered into under the provisions of this section.

(3) The provisions of sections twenty-five and twenty-six of the Act of 1949 (which relate to restrictions on notices to quit) shall not apply to any lease entered into under the provisions of this section.

(4) The provisions of this section shall apply to any agricultural holding in respect of which a contract of tenancy has been entered into before or after the commencement of this Act and shall apply to Scotland only."

The noble Marquess said: I beg to move the new clause standing in my name. My object is to endeavour to make it possible for landlord and tenant in Scotland to enter into a lease for a period—the suggested minimum period is fourteen years—and that at the conclusion of this period it shall be possible for either the landlord or the tenant to intimate to each other his intention of terminating the lease, if one or other desires to do so. At the present moment there is nothing debarring both tenant and landlord in Scotland from entering into a lease of such a nature, but at the termination of the period only the tenant can, with success, intimate his intention to terminate. If the landlord intimates his intention to terminate the lease, then under existing legislation the tenant has security of tenure.

Prior to the advent of the Agricultural Holdings (Scotland) Act, 1949, under which this legislation is brought up, it was customary for tenants to hold their land from a landlord on leases of this nature for fourteen, nineteen or twenty-five years, and in some parts even longer—the duration of the lease varying from district to district; but the effect was the same. This method of tenure was beneficial to the whole country, and I believe that it can truthfully be said that the standard of farming in Scotland was made by it. Most of the farms in Scotland have been developed to the state we see to-day by the combined effort of landlord and tenant during the past 200 years or so and not, as we so often hear suggested, by the landlord versus the tenant. I know from my own experience that, even now, where tenants are offered leases of this nature under existing legislation they are pleased to accept them, because they feel that the estates offering those leases want to co-operate with them, and give them the feeling of being wanted, by affording them a period of security, no matter what legislation requires.

I believe that if this Amendment could be accepted, both sides of this industry would be put on their mettle, as each would have to prove to the other, at the time when the lease came up for renewal, that he was worth having. At the present moment, as we know, a landlord has a remedy against a bad tenant, and a good tenant has safeguards against the bad landlord; but an average landlord has no remedy against what I would call the mediocre type of tenant (I think many of your Lordships will know what I mean), yet that type of person can often do far more harm than a bad tenant. In my Amendment I have mentioned the possibility of having breaks in the duration of the lease. I put this in because, in my own experience, I have found that tenants have repeatedly asked for such a provision when entering into a lease of any considerable duration, the reason being that they want a safeguard against some unforeseen happening. They may have a failure; they may not be so successful as they hoped to be and they may want to quit. This could be written in in order to give the tenant a "let out". Then he does not feel that he is held should the terms of trade go against him or should anything unforeseen happen.

It is not the intention of this Amendment to affect the security of tenure given to tenants having a tenure on a year-to-year term. The intention is that it should be purely a voluntary arrangement between the landlord and tenant. If each felt he had sufficient confidence in the other, they could enter into a lease of this nature and it would he binding. If the tenant felt that his landlord was not the type of person he would like to have as a landlord, that he could not trust him and that he would not get justice, then he could still remain on his present tenure till the end of his days. But in many cases I feel that new tenants will be required to enter into a lease of this nature; and I should like to repeat that I think it would be beneficial, as both sides would then have to live up to the required standards, one to another. The termination of a lease, with all the statutory liabilities regarding compensation already legislated for, would, of course, be binding.

I should like to add that the termination of a lease is a good time to adjust compensation for the various improvements that are carried out by a tenant during his tenure. Then both sides can start afresh, the landlord knowing what he owes and the tenant knowing his own position. I would press that this new clause be accepted, and that it should be possible for the Scottish landlord and tenant system to continue to flourish as it has done in the past.

Amendment moved— After Clause 6 insert the said new clause.—(The Marquess of Ailsa.)

LORD FORBES

I should like to support this Amendment. It is obviously designed to strengthen the landlord and tenant system. It is well known that the landlord and tenant system is the cornerstone of farming in Scotland. It is also known that this system is now failing, and it is quite easy to see why. If a tenanted farm becomes vacant—though tenanted farms very rarely become vacant in Scotland—the landowner either takes over the farm himself or sells it; and this is bringing about, quite rapidly, an end to the landlord and tenant system. Therefore, I submit that anything that can be done to strengthen the system should he encouraged.

LORD SILKIN

I hesitate to intervene in what has become a Scottish debate, but while I make no comment about the general principle of this clause, which is probably quite sound, I would draw attention to one point, and that is that it refers to a fourteen-year lease "with such break or breaks … as may be mutually agreed upon. …" It is possible to have such frequent breaks with both parties having the option to terminate, but the lease becomes virtually a lease for a short period.

THE MARQUESS OF AILSA

May I intervene? That is a point which I should have stressed. The breaks can operate only on the side of the tenant. If breaks are mutual, the duration of the lease is the period between the breaks, not a fourteen-years period or any longer period.

LORD SILKIN

That is the point I was making. There is nothing in this Amendment which says there is an option only on the part of the tenant. If there were, my observations would have no further effect.

THE MARQUESS OF AILSA

The point is this. If a lease is entered into for fourteen years (let us say, for the sake of argument), there might be mutual breaks operating both for the landlord and for the tenant every third year. That would be a lease for three years, with an option for it to run for fourteen years; but the duration of the lease is only three years, not fourteen.

LORD SILKIN

I speak with some diffidence because the position may be different in Scotland, but it is possible to have a fourteen-year lease determinable by either party at the end of every three years. In practice it would be a three-year lease subject to renewal, but in form it would be a fourteen-year lease, subject to determination every three years. Therefore I think that if the noble Marquess wishes to provide for the tenant only having the option to determine, he ought to say so in his Amendment.

6.37 p.m.

THE MINISTER OF STATE, SCOTTISH OFFICE (LORD STRATHCLYDE)

I should like to congratulate the noble Marquess, Lord Ailsa, on the manner in which he placed his new clause before the Committee. I must say that I agree with much that he said about the benefits that have been derived by both tenants and owners of land from the traditional long-lease system which has existed in Scotland for so many years, indeed up to the year 1948. But the noble Marquess is really advocating a return to the system of contractual leases, so far as Scotland is concerned, by legalising contracting out of the security of tenure provisions of the 1949 Act. I do not know whether the noble Marquess really appreciates that while a new tenant might conceivably agree to that course, for the sake of getting the holding, it seems hardly likely that a sitting tenant would deliberately sacrifice security of tenure for his lifetime for the limited security which a new lease would give him.

That apart, I confess to having some sympathy with the view that a return to the system of contractual leases is desirable, but I feel there are very considerable objections to the proposals in the clause which the noble Marquess has moved. Surely, if the principle of security of tenure as modified by this Bill is accepted it must apply to all tenancies. Again in a matter of this kind it must be difficult to argue that a different principle should apply to Scotland from the principle applied in England. That is one of the reasons why this Bill modifies the conditions inserted in the Act of 1948.

As your Lordships know, the question of security of tenure is one of the most controversial questions arising from the landlord and tenant relationship, and the lengthy debates in another place during the passage of this Bill are evidence of the high feelings which can be aroused. I know that in advocating what is, in effect, a return to the pre-1948 position regarding tenancies of agricultural holdings the noble Marquess, Lord Ailsa, is reflecting the very strongly held views of the Scottish Landowners' Federation. The Government, however, are of the opinion that that would be going too far. We appreciate that there is a need for greater flexibility than exists at the moment in the relations existing between landlord and tenant, but our appreciation of that need is shown in the Bill which we are now discussing, various clauses of which are particularly designed to ease that position. While I am grateful to the noble Marquess for ventilating this question, I hope that he will not press his Amendment, for it is one which I could not recommend your Lordships to accept.

THE MARQUESS OF AILSA

I beg leave to withdraw my Amendment.

Amendment, by leave, withdrawn.

Remaining clauses agreed to.

Schedules agreed to.

House resumed.