Lords Sitting of 22 July 1965

Preamble
The House met at three of the clock, The LORD CHANCELLOR on the Wool-sack.
Prayers—Read by the Lord Bishop of Leicester
The Viscount Malvern—Took the Oath.

SOUTHERN RAILWAY DELAYS AND SEASON TICKET HOLDERS
3.6 p.m.
LORD ELLENBOROUGH: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government, in view of the frequent inability on the part of British Rail to provide normal services on the South Eastern region, what means are available for season-ticket holders to recover part of their fares over a period.]
THE PARLIAMENTARY SECRETARY, MINISTRY OF TRANSPORT (LORD LINDGREN): My Lords, the Conditions on which refunds are made on British Railways season tickets are a matter for the Railways Board, not for my right honourable friend. If the noble Lord cares to address his inquiries to the Board I am sure that they will be able to explain the position.
LORD ELLENBOROUGH: My Lords, in thanking the noble Lord for that Answer, which I think is really very unsatisfactory, I should like to point out to him, as one who travels on one of the badly affected lines, that the delays which are taking place are now causing real hardship and stress. It is no longer just a matter of inconvenience. The delays are sometimes of up to three-quarters of an hour, which has been going on for about five weeks.
SEVERAL NOBLE LORDS: Order, order! Question!
LORD ELLENBOROUGH: My Lords, I should like to ask the noble Lord whether, in view of this now chaotic state
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of affairs, the Government are prepared to make it a contractual obligation on the part of the Railways Board to reimburse the public by means of an adjustment or an extension of season tickets in respect of the full fares which have already been paid, and for which only partial services are being received.
LORD LINDGREN: My Lords, a brief reply to that speech is that essentially, there is a contract between the purchaser of a ticket and the Railways Board. The rules and regulations governing the purchase of tickets should be known to the passengers when they purchase one. If they want to know the rules and regulations, they are available at railway stations. This matter has nothing whatever to do with my right honourable friend or Her Majesty's Government.
LORD ELLENBOROUGH: Then the rules should be changed.
LORD BALFOUR OF INCHRYE: My Lords, arising out of the Minister's reply, is it not a fact that the Minister of Transport has overall responsibility to Parliament for the running of British Railways to the satisfaction of Parliament? That being so, is it really right that the noble Lord should just brush off the question by saying that this has nothing to do the Minister, but is a matter for the Railways Board? Secondly, will the Minister please give an assurance that he will ask his right honourable friend to make quite sure that the Railways Board have knowledge of the letter in The Times to-day, which shows a very big contrast between the habits of British Railways and those of the Japanese Railways?
LORD LINDGREN: My Lords, it has been established ever since there have been nationalised industries, that day-to-day management is essentially a matter for the Boards themselves. Parliament has its opportunity, as shareholders, to discuss the Annual Report of any of these industries when it is presented to Parliament. In regard to the letter in The Times, I have no reason to believe that members of the Railways Board cannot read.
LORD DERWENT: My Lords, the noble Lord used the phrase "day-to-day management", but is this not a question of perpetual management?
LORD BALFOUR OF INCHRYE: My Lords, is this really day-to-day management? Is it not a question of broad policy, getting beyond day-to-day management'?
LORD LINDGREN: My Lords, with the greatest respect, railways have been in existence for over a hundred years. Everybody knows that when he buys a railway ticket there is no contract to take him on any particular train, or by any particular lorry, vehicle or vessel. That has been known for a hundred years, and it is part of the contract between the person who purchases a ticket and the Railways Board.
LORD WYNNE-JONES: My Lords, will my noble friend not agree that it has always been a Tory principle that the nationalised industries should be run without the interference of Ministers?
LORD LINDGREN: My Lords, I agree.

SOUTH AFRICA AND SALES OF DEFENCE EQUIPMENT
3.11 p.m.
LORD BARNBY: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether, in regard to the recently announced appointment in connection with the Sale of Defence Equipment, it is to be understood that the assignment includes the South African Republic whence, it is understood, purchases to the value of some £60 million were recently being considered.]
THE MINISTER OF DEFENCE FOR THE ROYAL AIR FORCE (LORD SHACKLETON): My Lords, Sir Donald Stokes's task is to advise the Secretary of State for Defence and the Minister of Aviation on the promotion of exports of defence equipment, and on any changes of organisation that may be necessary for this purpose. He will not be executively responsible for selling defence equipment to any particular country.
LORD BARNBY: My Lords, the noble Lord emphasised the Minister of Defence and the Minister of Aviation. Is naval equipment also included?
LORD SHACKLETON: My Lords, I have always understood that the Navy came under the Ministry of Defence.
LORD BARNBY: My Lords, I was puzzled why the noble Lord emphasised the distinction between Defence and the Air Force. But is it to be understood from the Answer, which seems different from some announcements which appeared in the Press—this is for general information—that Sir Donald Stokes is in no way concerned with activities to try to promote the sale of equipment to, or the purchase of equipment from, foreign sources?
LORD SHACKLETON: My Lords, I think the noble Lord was confused like other people. The Ministry of Aviation is concerned with the procurement and sales of aircraft. My Department for the Royal Air Force is, like the Navy, part of the whole Ministry of Defence. I think that may help the noble Lord. I do not quite understand the noble Lord's point. It is a fact that Sir Donald Stokes has been asked to advise the Government. The initial term of his appoinment, which was made exceedingly clear in the Press, was for three months during which he will look at organisation and also discuss matters with industry. There is a great deal to do, and there is a possibility that he will advise on particular sales, but he will not be directly concerned with the matter to which the noble Lord refers; and, of course, Government policy must remain supreme in these matters. We are not out to run an enormous arms sale throughout the world, regardless of national or international obligations.
LORD BARNBY: I thank the noble Lord for his explanation with regard to the Ministry of Defence. But might I ask him whether he could see his way clear to having some supplementary information put in the Press? Because, from some announcements in the Press, certainly the impression was given that the appointment was for the purpose of assisting the sale of defence equipment throughout the world; whereas, if I understand the noble Lord correctly—and perhaps he could make this clear—his role is only to advise the Government with regard to what may properly be permitted by way of the sale of arms throughout the world.
LORD SHACKLETON: My Lords, it is not his job to advise as to what may properly be permitted. He is concerned with advising on organisation, and how, within both the Government machine and industry, we can co-ordinate our efforts, and perhaps do rather better in the sales of defence equipment. I would not exclude the possibility that, with his great knowledge and experience, he may be able to assist in particular matters, but these are not within his current terms of reference. We shall see the position better in a few months, but I am glad to have had an opportunity of making this clear.
LORD BROCKWAY: My Lords, is my noble friend aware how many of us applaud the decision, which has been indicated in his Answer, that, when defence equipment is sold, the national purposes for which it is used will be considered? Could he say whether it is a fact that purchases to the value of some £600 million are now being considered? Do these include the vehicles which might be used for military purposes; and is it the case that the American Government has declined to provide these vehicles?
LORD SHACKLETON: I am afraid I do not quite understand my noble friend when he mentions the purchase of equipment to the tune of £600 million. Does he mean £60 million?
LORD BROCKWAY: Yes. I beg your Lordships' pardon.
LORD SHACKLETON: My Lords, I am not aware of the details of the requirements concerning the £60 million, to which the noble Lord referred, but I must make it clear that, on the export of arms to South Africa, our policy has been set out in numerous statements. We voted for the United Nations Resolutions on this subject, and this Government intend to ensure that our policy conforms with them.
LORD BARNBY: My Lords, the noble Lord's reply to that second question, which was not part of the original Question, puts the matter in quite a different light because of the deduction that may be drawn from it. Arising from that, may I ask him this: is it to be understood that the Government's intention is that, in the sale of arms, unrealistic
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ideologies shall swing decisions as to the directions in which we sell, bearing in mind the repeated emphasis which is properly put by Her Majesty's Government on the need to protect our balance of payments?

FORESTRY COMMISSION'S HORSE-RIDING FEES
3.17 p.m.
THE DUKE OF ATHOLL: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether the recent decision by the Foresty Commission to make a charge of £4 per horse per annum, to those who wish to make commercial use of the Commission's land for horse-riding, is within the powers of the Commission under section 4(6) of the Forestry Act 1945, or under any other statutory provision; and whether this decision has been made as the result of a direction given to them by the relevant Minister.]
THE JOINT PARLIAMENTARY SECRETARY, MINISTRY OF LAND AND NATURAL RESOURCES (LORD MITCHISON): My Lords, the decision to make an annual charge of £4 per horse for the use of Forestry Commission land to organisations such as riding schools was taken in the course of the Commission's normal management of their estate, in accordance with Section 4(6) and Section 4(7)(b) of the Forestry Act, 1945. The resulting income is paid into the Forestry Fund in accordance with Section 6(3) of the same Act.
The decision was not made under a direction given to the Commission by my right honourable friends; and I suggest that it is not inconsistent with the Commission's policy of encouraging public access to their forests to charge a fee to any person or organisation making commercial use of their land for riding or any other form of recreation. I hope that the noble Duke will agree that it is only equitable that, where the Commission's facilities are used to the profit of a third party, the Commission should expect a reasonable return.
THE DUKE OF ATHOLL: My Lords, while thanking the noble Lord for that

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Answer, do I gather that, henceforward, it is going to be the policy of public Commissions to make charges for such things as riding through their land? Do I further gather that the Government are going to encourage this; and would they not agree that this will tend to remove these forms of activity from the pockets of the vast majority of the people of this country? Because at the moment pony-trekking is not a paying proposition.
LORD MITCHISON: My Lords, as the Question indicated, this charge is made only in respect of the commercial use of the Forestry Commission's land. There is no charge for occasional riding; and regular riders can get a permit for a fee of £2 a year. I do not think that this is extortionate.
LORD CARRINGTON: My Lords, in the light of the original Answer given by the noble Lord, will he give an assurance that the Government can see the wood for the trees?
LORD MITCHISON: Yes, my Lords; without any difficulty.
LORD REA: My Lords, could the Minister say whether donkeys and motor-scooters are free?
LORD MITCHISON: My Lords, I am afraid that I have no information either about donkeys or about motor-scooters, but I will gladly inquire if the noble Lord asserts afterwards that he would like to know.
LORD HAWKE: My Lords, the first part of the noble Lord's answer dealt with the question of commercial use; and later he mentioned a £2 fee for ordinary riders. That is a completely new one on those people who regularly use Tilgate and St. Leonard's Forests and other forests for recreational purposes as ordinary riders. Is this intended to apply all over England?
LORD MITCHISON: What I understand to be the case is that the occasional user is not charged; but if someone uses Commission land regularly he can get leave to do so for £2 a year. I feel sure that the noble Lord would think it right that a small charge of that sort should be made, given that it is, after all, Forestry Commission land and public land.
LORD MOYNE: My Lords, would the noble Lord give an assurance that no charge would be made, however regular the use, when the riding was on a public bridle path which happens to cross Forestry Commission land?
LORD MITCHISON: Not without notice, my Lords.
LORD DERWENT: My Lords, would the noble Lord say that the Government would approve if private landlords did the same thing?
LORD SHEPHERD: Private landlords do so.
LORD MITCHISON: My Lords, I wish some of them would.
LORD DERWENT: Why?
LORD MITCHISON: Because it would be to the advantage of the public who, in those circumstances, would be able to ride on land or at places where perhaps they may not be so allowed at the moment.
NOBLE LORDS: They are allowed to do so.
LORD DERWENT: My Lords, anyone can ride over my land, provided he does so without damaging the crops. Is the noble Lord seriously suggesting that we should start charging?
LORD MITCHISON: My Lords, the noble Lord is a very public-spirited person. I am glad that he has told us that we may ride over his land provided we do not damage the crops.
THE DUKE OF ATHOLL: My Lords, is the noble Lord aware that heretofore the Forestry Commission have given almost unlimited access to riders anywhere in Scotland, and does he really think that making a charge of £4 a horse will encourage the use of the land for recreational purposes, as apparently is the Government's policy?
LORD MITCHISON: My Lords, I do not think it will discourage it. I think it is reasonable that a small charge should be made to someone who is making a profit out of letting out horses or organising expeditions of pony riders over Forestry Commission land. It is a matter for the Forestry Commission themselves; it is a matter of management.

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I feel sure that the noble Duke himself will feel that allowing the use of land in this way for horses which are let out on hire is an ordinary question of estate management and ought to be left to the Forestry Commission.
LORD SHEPHERD: My Lords, we have a lot of Business to deal with to-day. I know that this is a very important subject, but perhaps we could have it down for another day.
LORD SALTOUN: My Lords, may I ask one question? I am anxious that the noble Lord should clear it up. May I hope that what he has said applies only to England and Wales?—because in Scotland his answer would be contrary to Common Law; and therefore the matter is of some importance.
LORD MITCHISON: My Lords, I should hesitate to venture an opinion on Scottish law; but my answer was applicable to all three countries, England, Scotland and Wales, each of which has a Forestry Minister.
LORD SALTOUN: My Lords, do the Government really mean to invade the ordinary Common Law rights of the Scottish people for the sake of the Forestry Commission?
LORD MITCHISON: My Lords, Scottish rights are not being invaded.

THE LAW ON DISQUALIFICATION OF DRIVERS
3.25 p.m.
LORD WAKEFIELD OF KENDAL: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government what steps are being taken to clarify the law about the disqualification from driving of motorists.]
THE PARLIAMENTARY SECRETARY, MINISTRY OF TRANSPORT (LORD LINDGREN): My Lords, Her Majesty's Government have no evidence that the law on this subject needs clarifying in any major respect. The Road
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Traffic Act 1962 provides, subject to certain safeguards for drivers, for the three main classes of disqualification. First, a minimum of 12 months' automatic disqualification for the six most serious motoring offences; second, discretionary disqualification for a further twenty grave offences; and, thirdly, a minimum of six months' automatic disqualification for anyone convicted three times in three years for any of the 26 offences. Wide publicity was given to these provisions both while the Bill was passing through Parliament and when they came into force.
LORD WAKEFIELD OF KENDAL: My Lords, I thank the noble Lord for his Answer. Is he not aware that there is confusion both in the public mind and in the minds of those responsible for administering the law as to whether disqualification of a driver is a punishment or is merely a way of protecting the public, for some good reason? Does he not think that it is now time that this confusion in the public mind should be removed, and that it should be clearly laid down whether disqualification is a protection for the public or a punishment, or to what extent it is a mixture of both?
LORD LINDGREN: My Lords, it is a mixture of both. From my experience as a magistrate I have found that most motorists would sooner be heavily fined than disqualified.
LORD WAKEFIELD OF KENDAL: My Lords, I thank the noble Lord for that second answer. Does he realise that his answers have made the issue perhaps even more confused than it was before? People do not know where they are. Ought it not to be clearly laid down exactly to what extent disqualification is punishment and to what extent it is protection of the public?
LORD LINDGREN: My Lords, let us take the case of disqualification for driving under the influence of drink or drugs. It is a punishment of the individual and it is a protection for the public against a person who commits such an offence.

FUTURE BUSINESS
3.26 p.m.
LORD SHEPHERD: My Lords, at a suitable moment after 3.30 p.m. there will be two Statements. The first will be made by my noble and learned friend the Lord Chancellor, on the Royal Commission on the Tribunals of Inquiry (Evidence) Act, 1921. The second will be by my noble friend the Leader of the House, on the Security Commission Report.
In view of the large number of Amendments to the Rent Bill, the Government had hoped that the House could have remained in Committee until about 10.30 this evening, but I understand that there has been some misunderstanding in regard to a confidential and provisional document giving timing; and in view of representations that have been made I should like to state that the House will now remain in Committee on the Rent Bill until 8 p.m. or up to Clause 30, whichever may be earlier. It is proposed to conclude the Committee stage on the Rent Bill on Monday next, July 26. I am sure that, with the customary cooperation of your Lordships, this should be possible.
So far as other Business is concerned, it is proposed to take the Committee stage of the Race Relations Bill on Monday, August 2. The Redundancy Payments Bill is being brought from the Commons to-day, and the Bill as printed for this House will be available in the Printed Paper Office to-morrow morning. It is proposed that the Bill should be set down for Second Reading on Monday next, and that its Committee stage should be taken on Tuesday, August 3.
EARL ST. ALDWYN: My Lords, I should like to query one point in the noble Lord's Statement. He said that the Redundancy Payments Bill is to be taken on Monday next. Would that be after the Rent Bill Committee stage?
LORD SHEPHERD: My Lords, if that would be for the convenience of the House, I am sure that it could be arranged. At the moment it appears that the Rent Bill would come later; but if it should be the will of the House that it should be earlier, I am sure that this could be arranged.
EARL ST. ALDWYN: My Lords, I think it would be for the convenience of the House if we could take the Rent Bill first.
LORD SHEPHERD: My Lords, then we will do that.

BUSINESS OF THE HOUSE
LORD SHEPHERD: My Lords, on behalf of my noble friend the Leader of the House, I beg to move the Motion standing in his name on the Order Paper.
Moved, That Standing Order No. 35 (Arrangement of the Order Paper) and Standing Order No. 41 (No two stages of a Bill to be taken on one day) be suspended until the House adjourns for the Summer Recess.—(Lord Shepherd.)
On Question, Motion agreed to.

BRITISH WATERWAYS ORDER CONFIRMATION BILL
Read 3a (according to Order), and passed.

CARRIAGE OF GOODS BY ROAD BILL
House in Committee (according to Order).
House resumed: Bill reported without amendment; Report received.
Then, Standing Order No. 41 having been suspended (pursuant to Resolution), Bill read 3a, and passed.

OVERSEAS DEVELOPMENT AND SERVICE BILL
3.31 p.m.
Read 3a (according to Order).
Clause 2 [Power to meet expenses incurred in connection with employment in overseas territories]:
THE EARL OF BESSBOROUGH THE EARL OF BESSBOROUGH moved, in subsection (3), to leave out "and no person shall be designated under such an agreement". The noble Earl said: My Lords, your Lordships must forgive me for moving this Amendment again on Third Reading. I will not go into all the arguments again about why we think that these words should be omitted. Briefly, we consider that the requirement that the consent of the Treasury should be obtained to the designation of individual officers is wrong in principle,

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especially since the Plowden Report, accepted as it was by Parliament after the 1961 Act came into force, was critical of this kind of candle-ends economy.
In Committee, the noble Lord, Lord Taylor, himself admitted that on first looking at the words he felt rather as we did, and that up to a point they contradicted subsection (4) and were, perhaps, rather clumsy. It will be seen that in order to try to reach a compromise the noble Earl, Lord Selkirk, and I have today put down only one of our Amendments, that which concerns subsection (3). I think it only right that I should say again, as we did during the Committee stage discussions, that while we are now prepared to allow subsection (4) to stand, we are not happy about the arguments used by the noble Lord in resisting the first Amendment, that which we have put down again to-day. It seems to me to make no sense to suggest that by altering the wording of this Bill by excluding the words in question we should be providing an excuse for reopening all the hundreds of cases of designation and non-designation which have already been settled. This, of course, could happen whatever wording was put in. Unless things have changed a great deal during the last seven months, since the present Government have been in power, I believe that there must still be a steady stream of personal cases coming up in which officers who were not designated are trying to argue that the decision should be reversed. Surely the Minister is strong enough to maintain the present position, if that is what the Government think right, without having to hold a Treasury hand in the background.
With all respect—and I do respect the noble Lord, Lord Taylor—I think that his arguments so far have not been very strong on this point. As I see it, the real justification for the Treasury veto over individual cases in the 1961 legislation was that designation in this context was a new venture into completely uncharted seas, and since there were many thousands of officers who would come into consideration, the position in a single individual case might have set a precedent which would have to be followed for a really large number of people and might therefore cost a great deal of money. The
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position to-day is completely different. The main precedents have already been set and stoutly defended, and are well-established. The number of new cases could be only a handful compared with what has gone before. This point is made clear in the Explanatory Memorandum which indicates the relatively small amount of extra expenditure that is intended to be covered.
For these reasons, and for the reasons carefully stated during the Committee stage, we feel that we must again register our disagreement with the clause as it stands. We believe that what is at stake is largely a technical and drafting point, and your Lordships might have been able to improve the Bill considerably had the noble Lord been a little more sympathetic to our arguments. I do not want to divide the House on a relatively minor issue of this kind, I would much rather the noble Lord himself offered to accept our Amendment or, at least, was prepared to propose an alternative. I beg to move.
Amendment moved—
Page 2, line 30, leave out from ("into") to ("except") in line 31.—(The Earl of Bessborough.)
THE EARL OF SELKIRK: My Lords, I I think that it would be sensible to leave out the words suggested, it would make the Bill much more logical and remove the criticism of lack of principle. As it stands, it is undoubtedly clumsy. The interesting thing which emerged on Report stage was that almost certainly the Treasury are in breach of the law in not observing subsection (3). I do not know whether there is any system for surcharging the Lords Commissioners of the Treasury, but it is clear that they are not observing the section. The noble Lord, Lord Taylor, said that it would not make a great deal of difference if we did remove the words. For these reasons, I think it sensible to make the Bill a little better. The danger the noble Lord fears, that someone somewhere may misunderstand the intention is a very thin argument.
THE PARLIAMENTARY UNDERSECRETARY OF STATE FOR COMMONWEALTH RELATIONS AND FOR THE COLONIES (LORD TAYLOR): My Lords, I am very sorry that I cannot accept the Amendment moved by

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the noble Earl, Lord Bessborough, much as I should like to do so. The reasons I set out in some detail on a previous occasion. The noble Earl says that the main precedents are already set and that the new situation will apply only to a handful of cases. That is not so; there will be a large number of cases under the new conditions, which are that there will be agreements with bodies other than Governments; that is, universities, local authorities, public corporations and so on. This is really quite a new situation.
THE EARL OF BESSBOROUGH: But not so many as there were in the past.
LORD TAYLOR: Not so many as there were in the past; but a very substantial number. The whole object is to help the expatriate employees of these bodies, and there are already a considerable number of such employees. Quoting from memory, I think that the additional expenditure referred to in the Explanatory Memorandum rises to £1½ million, and if I remember rightly, the average amount of assistance would be of the order of £1,000 per case; so the assumption at once is that there might be up to 1,500 cases, which is certainly not a handful of cases.
The noble Lords want to leave in that the agreement shall be subject to Treasury consent, but to withdraw Treasury consent from the designation. In fact, the expenditure of money will arise under the designation and not under the agreement. The agreement will be the initial process with the university or other public body. It will be when it comes to making the actual designation of types of officer or individual officer who is to get the money that the expenditure will arise. That is the reason why it does not really make sense to accept the Amendment.
Moreover, if we accept the noble Earl's Amendment to do a half of what he proposed to do before, that would leave undone the other half and we are then in the position of putting no requirement at all in the Bill for Treasury consent to designation, because it will be purely an optional consent. Clause 4 qualifies Clause 3 and it is not right to say that the Treasury has been acting illegally and in breach of the law. Although when I
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first read the clause I had difficulty in understanding the sense of it, I think it is clear that this must be so. As the noble Earl knows well, it has worked satisfactorily. It was drawn up by his Government. We have already designated officers and we do not want to raise their hopes again by altering the terms under which they are designated. For all these reasons, I am sorry that I must resist the Amendment, although I should have liked to help if I could.
THE EARL OF BESSBOROUGH: My Lords, I am most grateful to the noble Lord for taking it in that spirit and for the further information about the number of officers likely to be designated in future, which is rather more than I expected, although I must admit that I still think subsection (4) makes sense on its own. It says:
"The consent of the Treasury to the designation of any person under such an agreement may be given generally in respect of persons"
et cetera. I should have thought that that would cover the whole thing. But I do not wish to press the noble Lord on this. He has been very good about giving us this further information. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
LORD TAYLOR: My Lords, I beg to move that this Bill do now pass.
Moved, That the Bill do now pass.—(Lord Taylor.)
On Question, Motion agreed to and Bill passed accordingly.

CRIMINAL PROCEDURE (SCOTLAND) BILL
3.43 p.m.
House in Committee (according to Order).
House resumed: Bill reported without amendment, Report received.
Then, Standing Order No. 41 having been suspended (pursuant to Resolution), Bill read 3a, and passed.

HOUSING (AMENDMENT) (SCOTLAND) BILL
Read 3a (according to Order), and passed.

HIGHLANDS AND ISLANDS DEVELOPMENT (SCOTLAND) BILL
3.45 p.m.
LORD SHEPHERD: My Lords, I have it in command from Her Majesty the Queen to acquaint the House that Her Majesty, having been informed of the purport of the Highlands and Islands Development (Scotland) Bill, has consented to place her interest, so far as it is concerned on behalf of the Crown, at the disposal of Parliament for the purposes of the Bill.
THE JOINT PARLIAMENTARY UNDER-SECRETARY OF STATE FOR SCOTLAND (LORD HUGHES): My Lords, I beg to move that this Bill be now read a third time. In doing so, I should like to say how grateful I am to noble Lords for the consideration which they have given to this very important Bill in the interests of the Highlands of Scotland. I ought to have done this at the end of the Committee stage, but there was a race between myself and the 10.15 train for Scotland. But I would not wish noble Lords to think that I was not appreciative of the way in which Amendments were tabled, carried and, in some cases, withdrawn, in the best interests of the measure.
Moved, That the Bill be now read 3a. —(Lord Hughes.)
THE MARQUESS OF LOTHIAN: My Lords, I do not wish to take up the time of the House, as there is a lot of Business ahead of us, but I should like to say a few words on this occasion. The noble Lord is aware that my noble friends on this side of the House have given a general welcome to the principles of the Bill. At the same time, I think that he will realise that even now we are not altogether satisfied that the Bill is as it might be. We are sorry that the noble Lord has not been able to meet us in many of the suggestions put forward by my noble friends, though I know that he appreciates the sincerity of our desire to achieve the best for the Highlands and Islands, as much as we do his.
In particular, I am sorry that he was unable to accede to our suggestions regarding the strengthening of the appeal
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machinery, for, despite his reassurances, I still feel that there is a danger that the individual, be he the small farmer or possibly the small hotelkeeper, will feel himself to be rather at the mercy of a somewhat impersonal, new, authoritarian body. I hope that I am wrong on this, but to my mind the danger is still there.
However, as the noble Lord has said, the Bill has been improved in its passage through the House and we are grateful to him for the morsels that have fallen from his table. I am equally sure that my noble friends on this side are very conscious of the patient and courteous way in which he has piloted the Bill through all its stages, and we are grateful to him for that. The important thing now is that the Bill should work, and work well. We all hope that it will. And, on behalf of my noble friends, I should like to wish the new Board every success in its vital and urgent task.
VISCOUNT MASSEREENE AND FERRARD: My Lords, before the Bill passes, may I just remind the Government of the experience of the late Lord Leverhulme, that great philanthropist who spent £2 million in the Hebrides to, I am afraid, very little account? Therefore, I would beseech the Government to "gang warily" in the Celtic twilight. They will have to be very tactful. But I hope that the objects of the Bill have every success, and they have my best wishes.
LORD DRUMALBYN: My Lords, I should like to add my thanks to the noble Lord, Lord Hughes, for the way in which he has conducted this Bill. I hope that the Bill is not going to be so much a Celtic twilight as a herald of the Celtic dawn. May I just make four points? First of all, the success of the Bill in helping the Highlands will depend on two things: first, on how well the Board diagnoses the needs of the Highlands and carries with it the various authorities, local government and others, operating in the Highlands; and, secondly, on the willingness of the Treasury to find the money. I hope that the Secretary of State will be able to find the right kind of Board, with the necessary expertise as well as the necessary enthusiasm. I must say that I am sorry that his hands have been somewhat tied by the condition laid down that half of the Board, including the chairman, must be whole-time. I should only like to say

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that if the Government want to alter this at any time, we shall be glad to assist them.
The second point is this. Our probings have revealed that, while the Scottish Office naturally want to leave the initiative in proposals to the Board and have no desire to interfere with the day-to-day working of the Board, the Board will not be an independent body in the sense that a nationalised corporation or even a New Town corporation is independent. In another place an effort was made to make the Board at least subject to independent audit. Here we tried to secure that any undertakings and businesses that they set up should be subject to independent audit. The Government resisted us. The fact remains that this Board is to be not so much an independent Board as an extension of Government. I do not think its status matters so much, so long as it is effective; but it is as well that its status should be understood.
Thirdly, we have tried to draw a distinction between individual ventures which the Board will carry out on its own, and the considerable joint projects which the Board will "concert and promote", to use the words of the Bill, but which will be largely carried out by local authorities and the multifarious commissions, corporations, companies and so on which operate in the Highlands as chosen instruments of the Government. We believe that the latter projects should be submitted to Parliament and subject to annulment. The Scottish Office have resisted that. I must say that I do not entirely blame them. It would be infuriating, I think, if such projects were handicapped, hamstrung or just plain wrecked by uninformed criticism in Parliament, for this very good reason: that, as has been said time and time again in this debate, the problems of the Highlands are unique and deserve special treatment.
That leads me to my fourth and last point. Because of the special and unique character of the Highlands, we do not oppose this Bill. As my noble friend said, we welcome it, even though it contains a conglomeration of powers, no doubt much precedented individually, but, taken as a whole, quite unparalleled in scope and range, even though it con-
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tains no Parliamentary safeguards at all. Nevertheless, the Government must not deduce that we are prepared to permit this Bill to be treated in any way as a precedent for other parts of the country. The setting up of a Government agency with almost unlimited powers, subject only to the control—admittedly, the close control—of a Minister, we regard as akin to the exercise of emergency powers and not as a pattern for Parliamentary democracy in the ordinary way.
I believe that this Bill can be, and I hope it will be, an important Bill for the Highlands. We trust that the Board will be fertile in its ideas and sound in their execution, and that it will exercise its powers with discretion and general acceptance in the Highlands. A great deal depends on its ability to carry with it the people of the Highlands. We trust, also, that the Exchequer will be generous, whatever the financial position. I believe that not only do the Highlands deserve, as well as need, generosity, but that the nation needs the Highlands, and will need them more and more in this crowded island as the years go by.
3.55 p.m.
THE EARL OF SELKIRK: My Lords, I should like to add my words of thanks to the noble Lord, Lord Hughes, who has conducted this rather lengthy discussion with skill and great perseverance. I, too, would say that this is an interesting Bill, and it has been almost universally welcomed in its intentions. The Government have achieved a remarkable situation, in that they have got right through the Bill without ever explaining at any time any schemes they proposed to carry out under it. It is very like the famous Bill at the beginning of the eighteenth century: "For a purpose hereafter to be revealed"; that is, in the gathering of powers which the Government have taken under this Bill. I am sure that the Board will need a great deal of co-operation, and I hope they will see that they have finance.
Like my noble friend Lord Drumalbyn, I, too, should like to refer for a moment to the structure of the organisation which we are here setting up. The noble Lord, Lord Hughes, will, I am sure, be familiar with the poem by Robert Burns about the henpecked husband. He will remember that it says:
"He has no sixpence but in her possession."

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This Board will spend no sixpence if it is against the wishes of the Secretary of State. They cannot have their own auditors. They cannot set up a clerical post without the consent of the Treasury. If they run a business, they need not publish a balance sheet. We know that administrative guidance will be given. The Board is really a sub-branch of the Scottish Office. I do not think that is right, although it may be. If it is, I wish the Board good fortune. But do not let us conceal from ourselves the nature of the structure which we are setting up; and, above all, do not let it be quoted to us as a precedent. What has happened is this: the Bill is setting up a wide range of powers in this new Board, wider, I think, than any other Board have, and the Secretary of State has placed them completely under his own control. So in many ways the present Secretary of State for Scotland has much wider powers than any other Secretary of State has had. I wish the Board well, and I hope that they will succeed. The conditions of the Highlands are exceptional, and it may well be that they will need exceptional treatment.
On Question, Bill read 3a with the Amendments, and passed, and returned to the Commons.

LOCAL GOVERNMENT (SCOTLAND) ACT 1947 (AMENDMENT) (NO. 2) BILL
House in Committee (according to Order).
House resumed: Bill reported without amendment; Report received.
Then, Standing Order No. 41 having been suspended (pursuant to Resolution), Bill read 3a, and passed.

ROYAL COMMISSION: TRIBUNALS OF INQUIRY
4.0 p.m.
THE LORD CHANCELLOR (LORD GARDINER): My Lords, with the permission of the House, I should like to repeat a Statement which the Prime Minister has just made in another place. His words were:
"In recent years anxiety about the working of the Tribunals of Inquiry (Evidence) Act 1921 has been expressed on every occasion on which the report
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of a tribunal set up under the Act has been debated in this House. Her Majesty's Government have given careful consideration to this matter, and I am now able to announce that the Queen has been pleased to approve the recommendation that a Royal Commission should be appointed with the following terms of reference:
'To review the working of the Tribunals of Inquiry (Evidence) Act 1921 and to consider whether it should be retained or replaced by some other procedure, and, if retained, whether any changes are necessary or desirable; and to make recommendations.'
The names of the Chairman and members of the Royal Commission will be announced later."
VISCOUNT DILHORNE: My Lords, while welcoming the announcement that the noble and learned Lord the Lord Chancellor has made to the House, I should like to ask him whether he would not agree that the first sentence of the Statement made by the Prime Minister is not wholly accurate? Is it not the case that, each time there has been a tribunal of inquiry since 1921, it has been followed by criticism of the procedure adopted in some respect or other at that particular inquiry? Also, is it not the case that each further inquiry has led to a further development of procedure? While welcoming the appointment of this Royal Commission to tackle the difficult problems that I know arise in the conduct of such inquiries, I would ask whether the noble and learned Lord would not agree that that was so.
THE LORD CHANCELLOR: My Lords, there have been reports of tribunals which have not led to any debate in another place; they have concerned relatively non-contentious inquiries. But it is the fact that, whenever a debate has taken place in another place on a particular tribunal, considerable anxiety has been expressed on a number of matters: on the inquisitorial nature of the procedure necessarily adopted by the tribunal; on allegations that wholly innocent and respectable people may become involved and may have to incur heavy legal expenditure in being legally represented before a tribunal; on the actual procedure before the tribunal, including such matters as the leading of

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evidence by counsel, the cross-examination of witnesses and, in particular, the somewhat equivocal part played in such inquiries by the Attorney General; and also on the arrangements for dealing with witnesses who refuse to answer questions.
All those are matters which the Royal Commission will be able to consider, as under their terms of reference they will also be able to consider alternative forms of inquiry, such as the Security Commission and the individual inquiry conducted privately by Lord Denning in relation to the Profumo matter.

SECURITY: REPORT ON THE BOSSARD AND ALLEN CASES
4.5 p.m.
THE LORD PRIVY SEAL (THE EARL OF LONGFORD): My Lords, with the permission of the House, I should like to repeat a Statement on the Report of the Security Commission about the Bossard and Allen cases, which the Prime Minister has just made in another place. Copies of the Report will be available in the Printed Paper Office this afternoon. The Prime Minister's words were as follows:
"I should like first to say that the Government is grateful to Lord Justice Winn and his two colleagues for the time and care which they have devoted to carrying out a most thorough inquiry. The House will also wish to endorse the tributes paid to the Security Service on the high degree of professional skill shown in the process by which the offenders were detected.
"Certain specific references in the original Report have been omitted or amended in the published text in the interest of security. These amendments have been made in consultation with Lord Justice Winn and also with the right honourable gentleman the Leader of the Opposition, who, in accordance with precedent, has been shown both the full and the published version of the Report. The amendments made are few in number and do not affect the substance of the Report or its conclusions.
"It is the responsibility of the Security Commission, when so requested by the Prime Minister, to investigate the circumstances in which a breach of security is known to have occurred in
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the public service and to advise whether any change in security arrangements is necessary or desirable; and in this Report the Commission have suggested a number of possible changes. Some of their proposals have already been accepted and acted on. The others are being considered. As the Commission themselves recognise, some of them involve difficult considerations of principle.
"As honourable Members have not yet had an opportunity of reading the Report I do not propose to comment on it in detail; but I should tell the House that the Commission have referred to the actions of individual civil servants and members of the Armed Forces, and their comments raise the question whether these individuals may have committed some offence against discipline.
"I have therefore decided that the actions of the serving officers concerned, who are subject to the Army Act, should be referred to the Army Board for investigation and decision as to whether the facts show a prima facie case for disciplinary action under that Act. In the case of the civil servants concerned, I have decided to appoint a board of inquiry to examine the facts and to assess the nature and gravity of any neglect of duty which may have occurred in order to assist in deciding whether disciplinary action is required. The individual civil servants who will appear before the board may be appropriately represented if they so wish. The members of this board will not be serving civil servants.
"In this connection I would remind the House that, in my Statement on May 10, I explained that the original concept of the Commission, which was announced by the right honourable gentleman the Leader of the Opposition on January 23, 1964, after consultation with me, was defective because the Commission could not begin its operations in a case which involved court action resulting from a breach of security until the case had been concluded. In the present cases we overcame this difficulty by asking a small Committee, under the chairmanship of Sir Laurence

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Helsby, to carry out a preliminary, confidential inquiry. The Security Commission in their Report pay tribute to the usefulness to them of the work of this inquiry and acknowledge that valuable steps were thus able to be at once taken whilst the prosecutions were pending. For the future, the procedure has been altered so that a reference can be made to the Security Commission as soon as the Government are satisfied or have good reason to think that a breach of security has occurred in the public service. The Report of the Commission on this occasion has, however, now pointed to the further problem which arises where individual civil servants or serving officers may be held by the Commission to have been at fault. The remedy we have adopted this time is, as I have said, to institute further investigations specifically directed to the acts of the individuals concerned and during which they may be advised and represented. It may be that some other procedure would serve better in future and this is a matter which must be considered in due course.
"One last point. The investigation on this occasion—the first on which the Security Commission have operated—has put a heavy burden on the three members of the Commission. I hope that we shall not often need to ask the Commission to act, and there is at this time no case pending which would suggest that they will have to be activated again in the near future. Nevertheless, Lord Justice Winn and his colleagues have suggested that it would be prudent to enlarge the membership of the Commission, and with the agreement of the right honourable Gentleman the Leader of the Opposition I propose to accept this suggestion. On any future occasion when a reference is made to the Commission, it will still be the practice for three members to sit, but they will be drawn from a larger total. I shall announce the additional names as soon as I can."
My Lords, that concludes the Statement of the Prime Minister.
LORD CARRINGTON: My Lords, I am very grateful to the noble Earl the Leader of the House for repeating this Statement. Security is a matter of great
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national importance and it is, as I know from personal experience, a very complicated matter which sometimes gives rise to conflicts of principle. For this reason I do not think that it would be very helpful or wise for me to comment in any detail on what the noble Earl has said, before I have had a chance, as my noble friends behind me, of reading the Report. Certainly we shall read it with great interest, and I am sure that if there is anything there we want to know the noble Earl will be only too pleased to give us the answer.
There is one question that I would ask now, on a matter which I do not quite understand in the Report. It is not entirely clear from the Statement whether or not the two classes of person who might be considered to blame in some respect, that is serving officers and civil servants, are to be treated in exactly the same manner. It appeared that the serving officers' cases are to be looked into by the Army Board but that the civil servants will have a Board of Inquiry specially set up for that purpose. Surely the Army Board is hardly likely to be in exactly the same position to inquire into this matter as is a Board specially set up for that purpose? Could the noble Earl clear up that point for me?
THE EARL OF LONGFORD: My Lords, I am most grateful for the understanding attitude of the noble Lord the Leader of the Opposition, and I need hardly say that I shall be only too anxious to give him any information in my power, now or at any time, about this matter. I suppose that the point one should make is that if the Army Board finds that a prima facie case does lie against the officers, they would then, under the Army Act, be liable to trial by court-martial. Of course I am not saying that that point would be reached, but that is what would happen. It is open to any serving officer in those circumstances to insist on a trial by court-martial. On the other hand, the responsibility for disciplinary action—since we are not talking of criminal prosecution in any case—in the case of a civil servant rests with his Minister, and that appears to be the basis of the distinction drawn.
LORD CARRINGTON: My Lords, I do not want to follow this up, but my

913
point is that the Army Board is the direct descendant of the Army Council, and is set up for an entirely different purpose. It discusses all sorts of general Army matters. A Board of Inquiry would consist of rather different people with specialised knowledge, presumably, of security. The only point I was concerned with was that both serving officers and civil servants should have exactly the same sort of treatment.
THE EARL OF LONGFORD: My Lords, I should not like to say exactly what is involved here at every point, but I personally feel confident—and I hope I am right—that in each case the procedure adopted is that which is most likely to be helpful to the individual who may be placed in this rather awkward situation.

REDUNDANCY PAYMENTS BILL
Brought from the Commons; read 1a, and to be printed.
NEW TOWNS BILL [H.L.]
Read 3a (according to Order), and passed, and sent to the Commons.
MINISTERIAL SALARIES CONSOLIDATION BILL [H.L.]
Read 3a (according to Order), and passed, and sent to the Commons.
NUCLEAR INSTALLATIONS BILL [H.L.]
Read 3a (according to Order), and passed, and sent to the Commons.

RENT BILL
4.16 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.—(Lord Mitchison.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD MERTHYR in the Chair.]
Clause 1:
Regulated tenancies.
1.—(1) The Rent Acts shall apply, subject to the provisions of this section, to every tenancy of a dwelling-house the rateable value
914
of which on the appropriate day did not exceed, in Greater London £400, and elsewhere in Great Britain £200; and references (however expressed) in any enactment to a dwelling-house to which those Acts apply shall be construed accordingly.
THE CHAIRMAN OF COMMITTEES: My Lords, before I call Amendment No. 1 may I point out to the Committee that if this Amendment is passed, Nos. 2 and 3 cannot be called.
LORD HASTINGS LORD HASTINGS moved, in subsection (1), to omit "£400, and elsewhere in Great Britain £200", and to insert instead:
"£350, in the Special Review Areas in England and Wales (as defined by section 17(1)(a) and (2), section 25 and the Third Schedule to the Local Government Act 1958) £200, and elsewhere in Great Britain £150;").
The noble Lord said: It might be for the convenience of the Committee, and I hope particularly for the noble Lords opposite and the Government, if, before actually dealing with this Amendment, as it is the first Amendment of a rather protracted Committee stage, I should preface my remarks with a brief preamble. I think it would help the Government to appreciate the approach of the Opposition to the whole of this Committee stage and to understand our attitude.
Clause 1 sets up the framework of the whole Bill. It is, in fact, the basis of the Bill and therefore the most important clause in it. The Government have done two things in this clause: they have decided on the base upon which the Rent Bill should operate, and they have taken as the foundations for the building which they are going to put upon it the whole of Great Britain. Those are the foundations—what I might describe as the horizontal base for the Bill—and then they have erected on that horizontal base their vertical superstructure and have defined it and circumscribed it. This Amendment deals with the superstructure and not the foundation.
We have not put down an Amendment on the coverage of the Bill as far as the geographical case is concerned because we realise that here is a fundamental difference of principle between the Government and the Opposition. The Government believe that it is right to control and regulate rents in the whole

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of the country. We do not; we should like to limit it, as we said at Second Reading, to London and the major conurbations. This really means the difference between the two sides of the House, between Socialist theory that control is a good thing for its own sake, and Conservative philosophy that that is not so and that control should be limited to the absolute minimum necessary for the community. It is because of this division of principle and philosophy that we have not put down an Amendment on that subject, because we know the Government cannot accept it and they might feel justified in believing that we were putting on a filibuster and moving a wrecking Amendment. I claim that no Amendment on this Marshalled List coming from this side of the House is of that nature. It is our intention to improve the Bill, and we believe there are Amendments here that the Government should be able to accept, and even be grateful for.
I thought I should start like that so that the noble Lord may realise that we consider that this first Amendment is put down in an attempt to meet the requirements of necessity and at the same time to bring about greater efficiency, and incidentally greater justice, in the operation of this Bill. I know that in another place Amendments were moved on this particular aspect and rateable values of £250 and £300 were successively turned down by the Government in respect of values referring to London.
A certain amount of play was made with figures during our Second Reading; we got a little involved. There is one figure I want to mention, and that is the one used by the noble Lord, Lord Mitchison, and by his right honourable friend previously in another place, that 160,000 houses were outside control at the time of the 1957 Act, just before it (this refers to outside London) and that the same number will be outside control after this Bill is passed. In London the figures were 30,000 and 15,000—a reduction in London.
But I really cannot accept that that is a reasonable excuse. After all, we are now in 1965 and not 1957. People are much better off, and it is absurd to say that we can afford to leave out of the regulations of this Bill only 160,000 in the country as a whole. That, according to my calculations, would be
916
about 4 per cent. of privately rented houses, and only 2 per cent. of all rented houses if those owned by local authorities are included. Without affecting the real objective and purpose of this Bill we ought to be able to leave out a far larger number, and I reject the argument put forward by the Government that because so many were left out in 1957 we should leave out about the same number now.
May I now turn to the detail of this Amendment and to the London scene? We have put down a rateable value of £350, £50 less than that of the Government, £50 more than the last Amendment moved by the Opposition in another place. Here I think it is necessary to clarify what this rateable value means. A rateable value of £350 means a gross value of just about £440. That is slap in the middle of the bracket pointed out by the Milner Holland Report for a sufficient amount of housing for rent in London. It said between £400 and £500. And remember, the rent is to be related to the gross value and not to the rateable value; and the rateable value of £350 is the equivalent of a gross value, and therefore a notional rent, of £440. I should have thought that splitting the difference of the Milner Holland bracket would be a very reasonable thing to do, and I do not see how the Government can really make a case against it.
The noble Lord, Lord Mitchison, on Second Reading, in an interjection said that the majority of rents in London were in fact below the rateable value, and said he would have percentages to prove it. In the first place, I think he must have made an error, because he must have meant gross value and not rateable value. If he would turn to page 356 of the Milner Holland Report, Tables 35 and 36, he will there find set out the ratio of net rent to new gross value, so we are talking about gross value, and he will see there that in respect of uncontrolled houses, unfurnished houses, there were 46 per cent. of singly-occupied houses and purpose-built flats where rent was more than the gross value; and in respect of parts of houses or flats 69 per cent. had a rent exceeding their new gross value. Therefore, I do not know how the noble Lord can justify his remark on Second Reading. In respect of furnished houses, no less than 99 per cent. had rents above gross value.
Therefore, I should like to know why the noble Lord thinks it is necessary to put the figure as high as £400. Indeed, the noble Lord himself said on Second Reading that even if it were reduced to £300 for London it would not make very much difference, but the Government wanted to be on the safe side. I cannot see any justification for going over £350, and I think the few figures I have quoted—and I do not want to bore the Committee with many—is sufficient proof of that. Perhaps the noble Lord can tell us what difference it would make, in terms of the number of houses with a rateable value between £350 and £400.
I turn to the central part of the Amendment, where we have put down something new. After getting the Milner Holland Report, we have always said that we should be ready to legislate for security of tenure, which means, of course, having regulated rents as well, and bearing in mind also the possibility, even the probability, that some similar legislation would be required in the large conurbations. We do not want to dispute that. It is very difficult to get reliable figures in the large conurbations. I have included them at the Government's own figure of £200, so T do not think they can possibly complain about that.
I now come to the third part of the Amendment, where we want to reduce the rateable value from £200 to £150. That, again, seems an eminently reasonable thing to do. It is surely logical that the rateable values and rents will be higher in the large conurbations, owing to the scarcity of housing to be found in those areas. Where scarcity is much less, or where there is no scarcity at all, it is clear that the rateable values and the rents will be lower. In those areas, of course, is included a very important part of the country which this Bill affects, and that is Scotland. In another place, when this matter was being discussed the Under-Secretary of State for Scotland himself pointed out that the old rateable value limit of control of £90 existing before the 1957 Act would be equivalent to £125 now in Scotland. But he added, "We want to be sure, so we put it up to £200". A jump from £125 to £200 is simply enormous.
We have allowed a little scope to the Government in this respect and we have
918
taken the Under-Secretary of State for Scotland at his, word—that the real equivalent rateable value would be £125—and we have made it £150. Even then I do not think a great many houses in Scotland will be excluded. At £200 I believe it was only to be 500 houses, or as some people said, castles. At £150 there would be a few more, but at the same time it would make the operation of the Act much easier in that country. Indeed, one knows well that in urban areas, and particularly in rural areas, the number of occasions on which a house is rated at over £150 is not great. I should prefer to have a figure of £125, because even at that rate you get a good standard of housing outside the conurbations. At over £150 you are getting into the luxury standard—there is no doubt about it.
I have put this case at some length. I shall certainly not have to speak for anything like so long in moving any other Amendments. I wanted to emphasise to the Government the importance we attach to this first Amendment, and to stress that we believe that it would be an improvement to the Bill on the grounds of necessity, efficiency and justice. I greatly hope that the Government will see their way to accepting this Amendment, because I think it is eminently reasonable. I have tried to argue it logically and reasonably, yet forcefully, because we believe that the Amendment should be accepted. I beg to move.
Amendment moved—
Page 1, line 11, leave out from ("London") to end of line and insert the said new words.—(Lord Hastings.)
4.32 p.m.
LORD MOLSON: In view of the fact that if this Amendment were accepted my own two Amendments would fall to the ground, perhaps I may speak to this Amendment and comment upon the figures that I have put into my Amendment—that is to say, £300 instead of £400; and £100 instead of £200. I should like to associate myself with what my noble friend Lord Hastings has said about our approach to this Bill. On Second Reading I went out of my way to say that I thought that it was capable of being an extremely good measure if it were sufficiently amended, and in particular I said that I had always liked the idea of having fair rents instead of

919
creeping complete control. Therefore, I have put down Amendments, in the hope that the Government will be willing to narrow the scope of the Bill in order that it will be much easier to administer and will apply to those particular categories of houses to which I think the Government wish to apply it.
I am not wholly without hope that the Government may be prepared to accept some of these Amendments, because of the tone of the speeches made in another place by the Minister. In particular, on June 29, at column 575, he expressed the Government's point of view about somewhat similar Amendments that were moved. He pointed out that the Bill has machinery for lowering the rateable value, and, indeed, of excluding complete areas. He said that the Government were taking power to reduce the scope of the Bill, and he gave an undertaking that in suitable cases they would do so without any avoidable delay. I hope that the Government may be willing to consider the argument that the Bill should now be modified in order not to include the large number of houses which, according to what they themselves have said, they would be quite willing to exclude later.
My noble friend Lord Hastings has moved an Amendment for which I think there is a great deal to be said. I do not wholly agree with the figures that he has put down: I do not think that they go far enough. But we are in this great difficulty that, so far as I can make out, it is not possible for private individuals to find out what would be the number of houses included at different rates of gross valuation. My information (I think it is derived from a Government statement) is that under the Bill, as at present drafted, only 1·7 per cent. of the domestic properties in England and Wales will be above the level which is included in this Bill. I understand that 83·5 per cent. have a rateable value of £100 or less, and that a further 14·8 per cent. fall within the range, £101 to £200, leaving only 1·7 per cent. above the level that is caught by the clauses of this Bill. As a number of that 1·7 per cent. will be in London, it means that only a small proportion of the properties in the rest of England and Wales would be excluded.
I should find it surprising if the Minister could give me the figures here
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and now, but it would be valuable and helpful if, before the Report stage, the Government would indicate at what level of rateable value different quantities of houses in the country would be included. I should have thought, entirely as a guess, that if something like 75 per cent. of the properties in this country were included in this Bill, that would deal with the cases where there is any danger of hardship and where it is necessary to have control.
That is the general argument that I should like to put forward. As I say, it seems to me that there would be nothing inconsistent with the line taken by the Government in another place if they were prepared to lower the present levels set out in the Bill. It means merely that, instead of going to a height above what they think is necessary, and with a view to using the subsequent clauses to exclude areas and values which they do not think need to be included, they should accept an Amendment at this stage. There is clearly one great advantage in adopting such a course. It is obviously going to be a major administrative task to set up this organisation over the whole of the country; to find the necessary number of experienced and impartial rent officers; to set up and man the rent tribunals, and to deal with the vast number of cases that are liable to be brought before them. I believe that it would make the Bill far more manageable and convenient if, either at this stage or on Report, the Government were prepared to accept an Amendment on the lines of that moved by my noble friend, or the one that I suggest.
LORD WOLVERTON: I support this Amendment. I think it is one of paramount importance. I should like to reinforce what my noble friend Lord Molson has just said: that it is bound to be difficult to find enough skilled valuers to do this job. Only recently I retired after nine years as a member of a county council, and I know how difficult it is to fill the present vacancies for local government officers. Such men are in short supply. Other councils have equal difficulty. It is bound to be difficult for councils to find this vast number of men who must be skilled in this operation. I do not think we ought to put on them any more onus than is absolutely necessary. Moreover, while I agree that one

921
must have flexible rent control in big cities like London, in the Midland conurbations, and in the North-East and the North-West, I cannot see that it is necessary to keep so many houses under control in the other areas. That point has already been made by my noble friend Lord Molson. I hope that the Government will give serious consideration to this Amendment, because I think it is one of the most important that we shall be discussing this afternoon.
4.40 p.m.
LORD MITCHISON: I should like to express my thanks to the noble Lord, Lord Hastings, for his very clear explanation of the Opposition's attitude to this Bill, and for his undertaking, as I understood it—which I will seek to emulate—to deal with these Amendments as concisely as possible. I must correct one major point, because it appears to go to the root of the Opposition's attitude, and certainly affects our view of the Bill as a whole. The noble Lord told us—perhaps it was the old devil popping out!—that the view of the Socialist Government was "control for control's sake". That is quite untrue of this Bill, and is utterly irrelevant to this Amendment.
LORD HASTINGS: I was speaking about the Amendment which we did not move.
LORD MITCHISON: I will try not to follow the noble Lord up that byway, but I think what he said was intended to represent the views of the Opposition about the Bill as a whole. We had better get it right. We cannot necessarily get them to understand it, but we can do our best to restate it.
This Bill is not for the purpose of regulating or controlling rents for the sake of regulation and control. It has one object: to provide security of tenure and to do certain things in that connection for a considerable group of people who were deprived of that security by the 1957 Act. I will not be tempted by what the noble Lord, Lord Newton, said last time to express my views of the 1957 Act with a full flourish of vituperative language, but I could easily do so. I think that no single Statute passed under the Tory Administration of thirteen years did more harm, and caused more misery to a large number of people, than that
922
particular measure. I hope that I have complied with Lord Newton's feeling that I have been too gentle about the matter.
LORD NEWTON: I never doubted or attempted to cast doubt on the ability of the noble Lord, Lord Mitchison, to use vituperative language: it is on the Record.
LORD MITCHISON: I do not find anything to quarrel with in that. However, that is the object of this Bill. Regulation is merely a means for doing it. It is a new means, and, as Lord Molson told us just now, it has great merits as a means, and has never been tried before. Previously we have always had control by arithmetical limits of some sort. That control, so far as it exists, is preserved, but what happened was that the 1957 Act, by reducing the sphere of control very considerably, freed a number of people from control altogether and took power to decontrol further by ministerial order—a point which is sometimes forgotten.
LORD NEWTON: So does this Bill.
LORD MITCHISON: What we are doing at this moment is to provide protection for that group of people. They will not be the same individuals, but the same group of people will receive the protection that was taken away by the 1957 Act. In that sense what we are doing by this Bill is effectively carrying out an Election promise to repeal the 1957 Act.
Although we think that regulation is a much better way of doing it, and we are pleased to be able to put this Bill before Parliament, it is none the less simply a means, and the object of the Bill is the object that I have described. I make no apology for saying that as clearly as it lies in my power. I do not for one moment expect that noble Lords opposite will cease saying that the object of the Bill is to introduce Socialist regulation or control for its own sake. I think that people believe that kind of thing, and if they say it often enough it becomes almost impossible to persuade them of anything else. But many of those who spoke on Second Reading realised that the Bill had another object, and they gave it an unopposed Second Reading. If it really had as its main object Socialist control for its own sake,

923
I wonder what induced noble Lords opposite to give it an unopposed Second Reading? Of course, it has a broad public purpose.
In order to apply regulation we must begin by seeing that we do not leave out too much. I put it that way for the reason that the Bill contains, and rightly contains, a provision for allowing the release of categories of buildings over a certain rateable value in areas of the country. If in fact, on experience, one discovered that in Greater London, say, the limit of £400 was too high, one could then reduce it to £375, £350, or to whatever figure experience showed was right. But there is no similar provision to that in the 1957 Act for enlarging the remedy which one is invoking in this matter. One cannot start at £300 or £350 now and then, if we find later that we have left out too much, increase the limit. There is no provision without further legislation for increasing the limit. That being so, it seems to me to be every inducement to be careful at the first stage.
I will deal with the figures as carefully as I can. One must be very careful when dealing with housing statistics. I assure Lord Hastings that the percentages I had in mind in the interjection to which he referred were, in fact, percentages of the gross rateable value, and that the information which I then gave him as regards those percentages was correct as I understood it, although it was on the rather small sample. I prefer to put this matter in the way in which I put it on Second Reading; because I believe that it presents the picture the right way. The 1957 control left out about 160,000 houses at the top—that is the pre-1957 control; that is the number left out by the present £200 and £400 limit. Taking London as a special case, fewer houses are left out in London than were left out by the pre-1957 limit. The houses which were left out by the pre-1957 limit numbered, roughly, 30,000, and at present they number about 15,000. On the face of it that looks pretty fair, certainly as regards the rest of the country.
What about the position of London? I would suggest that one has to bear in mind two things about London. First of all, that it is in London where the housing conditions are at the worst and
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most difficult at the moment, and that a mistake in London might be extremely difficult to rectify if it were a mistake in the direction of leaving out too much. The second point follows from that. The noble Lord, Lord Hastings, said that we need not bother too much about that kind of comparison because we have all since become better off. That really does not help at all. What one is trying to do here by regulation is, in the first place, to get an agreement about what is a fair rent, and, failing that agreement, to get the question of a fair rent referred first to a conciliation officer, called the rent officer, and, secondly, to a rent assessment committee.
Therefore, if you extend control too far, whom exactly are you going to injure? You are certainly not going to injure the people who agree, and would have agreed anyhow, and I hope and believe—and here I hope I have the support of the noble Lords opposite, at any rate after reading the Milner Holland Report—that that will comprise the majority of people in the country. You are not going to inflict any hardship on them. They have their agreements and they would have their agreement under any circumstances.
Then the next case is that of somebody who, for one reason or another, is asking too much. I am not saying that this is a case of innate wickedness. It is nothing of the sort. But, if a person is asking too much by way of rent, we are providing for his demand to be reduced to a fair rent. I do not call this harsh oppression. To reduce what is ex hypothesi unfair to fairness is not exactly crushing the landlord beneath the feet of a wicked Socialist bureaucracy. It is merely getting him to refer his notion of what is fair and what is not fair to the judgment of his fellow men with some experience in this matter. That is all. I cannot say that I think that is oppressive. To suggestions therefore that fixing too high a limit of this sort is really going to do any social or moral injustice to anybody, I am afraid I would simply turn an absolutely unyielding front. It cannot be so, when what you are talking about is the type of regulation I am discussing. You may say that it will not work properly, but that is another question. I think this machinery is as

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good as human ingenuity can make it. I will not say any more than that; nobody can. But that is all you are doing.
In these circumstances, what are the real arguments for reducing the figures in the Bill? These are figures, of course, about a rateable value; as I understand it, in these cases a net rateable value. The percentages I gave related to a gross value. They are arrived at so as to produce in the country as a whole the same result as existed under the 1957 control. After all, if we did not at any rate try to do that, we should hardly be carrying out the promise we made to repeal the 1957 Act itself. That is exactly what we are doing, and I am sure that noble Lords opposite would not wish us to break our Election pledges on that.
Let us turn to London. I think it was the noble Lord, Lord Molson, who said quite correctly that the actual figures are very small. They are extremely difficult to get at, but take the ones I have given. The difference between 30,000 and 15,000—that is to say, between the number of houses left out at the top before 1957 and the number left out now—is 15,000. That in itself is not very large. But it also includes the other kinds of houses which are held under different tenures than the private lettings which we are now considering. The proportion of private lettings over the country as a whole is about one-quarter of the total, and on that basis you could say 4,000, perhaps, in London. But that is not the whole story. I venture to think that if you were able to work this out, you would find that the proportion of private lettings up at the top of the scale was, if anything, rather smaller. But I do not think I am concerned with that.
I am merely concerned to say to your Lordships that I do not think a large number of houses would be involved by the London figure, which I am taking for this purpose because it is the one that needs a little more defence. Taking a low figure like that, it is small but it is not negligible, and I cannot see why people who are living in a house with a rateable value between £350 and £400 should really be deprived of protection. Of course, it may be said to that, "If you were logi-
926
cal you would have it extending over the whole run of houses without any limit at all". I suppose that would be perfect logic in one sense, but I am not quite certain, because when you get above a certain limit you get to rather peculiar cases, rather exceptional houses. I understand that there are castles in Scotland which were discussed in another place, and no doubt there are similar large houses in London, and it is those which we have tried to keep out. But we see no reason to reduce these figures here.
I turn from that to the Milner Holland Report. I thought the noble Lord, Lord Hastings, quoted the Milner Holland figures, perhaps inadvertently, as rateable value figures, but of course they are rents. What Milner Holland said, at the bottom of page 179—he said it in one or two places—was this:
"We are satisfied on the evidence before us that there is plenty of good accommodation for rent in London at rentals of £400-£500 per annum and above."
This passage was very strongly relied on in another place, and it was said, "If that is the position, why do you want any regulation?" Two answers were made, and I repeat them here. The first of them is this. If you were doing anything fatal and irrevocable by fixing too high a limit, I should see the force of some of the observations that were made. But you are not doing that. You are simply trying to ascertain what is required towards the top of the scale in this case. That is the first point.
The second point is that my right honourable friend the Minister pointed out that there was other evidence that he had had which was not in accord with that particular conclusion in the Milner Holland Report; and I noticed that in your Lordships' House the other day my noble friend Lord Silkin, who has probably as great an experience of this kind of thing as any of us, was also a little critical about this particular limit. All I say to your Lordships is this. If that is the position, why run the risk of leaving out too much when leaving out too little can so easily be remedied afterwards? I cannot see the answer to that.
However, there is yet another way of looking at the matter. I have been trying to ascertain for a number of days past what is the relation between the net rateable values with which we are dealing

927
here and the rents at this sort of level. I confess frankly to your Lordships that I cannot do it, and I do not think that the information is in the possession of any Government Department. It is not at all easy to discover, because you have got to remember that you are dealing with private rented houses only, and you could easily get false figures another way. But I have got this far in the matter. Three times in another place Amendments were moved on behalf of the Opposition, always by the same right honourable Member, Mr. Boyd-Carpenter, and three times he relied on the proposition that if you took a rateable value of, say, £300 the equivalent rental was to be found by multiplying that rateable value of £300 by 2 or more. He took 2, 2⅓ and 2½.
All I can say to your Lordships—and I say it with a full sense of responsibility—is that, so far as I can discover on all the information available, that multiplier is grossly too high. I am not sure what the right multiplier is and I cannot give an answer. At what I might call an informed guess—that is to say, having looked at a whole lot of figures—I am inclined to think it is somewhere about 1¼ or 1½. This makes a very considerable difference, because the argument was put like this: "We are proposing", it was said, "a limit in London of £300. Multiply it by 2 or 2½ and you land in the middle, or thereabouts, of the Milner Holland figures. You get into the safe range". The fallacy was that the multiplier was wrong, and there is no doubt about it.
I looked for the source of the multiplier all through those debates. It is true that at one point Mr. Boyd-Carpenter said that he was "so advised". I do not know who gave him the advice, and he gave no indication. One noble Lord was quite correct in saying that, the way the debates went in another place, this was not pointed out to Mr. Boyd-Carpenter perhaps as clearly or as often as it might have been; but I assure your Lordships that, to the best of my knowledge and belief—and I can go no further than that—a multiplier of that order is far too high, and therefore the arguments which were put forward by the leading speaker for the Opposition in another place were arguments based on a very important but false premise.
928
If that is the case, one begins to think again. I noticed that to-day the noble Lord, Lord Hastings, did not refer to arguments of this kind at all. He may have gathered from the course of the Second Reading debate that they were a little open to suspicion. I therefore looked to see what his arguments really were. I do not want to be rude, but I found it very difficult to discover what was his real reason for wanting to lower the limits, except the perfectly general assertion that regulation over the figures he proposed was not needed. I think one wants more support than that. If I may take the table to which he referred in the Milner Holland Report and relate the net rents there to the gross annual values, the multiplier, I think, would become of the order of 1·4. If it is of the order of 1·4, then your Lordships will see that, on these figures, £300 is not high enough; and I find it very difficult indeed to think that one ought to go as close as that.
The long and the short of it, I believe, is this. This is a Bill to introduce a form of regulation which is not oppressive, which is perfectly reasonable and which is designed to help a group of people who have had a terribly hard time in the London area in recent years. If we are going to apply it at all, then let us see that we apply it fully and see that there is the power to reduce the amount under a later clause by such steps and in such areas as are necessary. It is said that that will increase (I forget the exact words which the noble Lord, Lord Molson, used) the size of the machine. I do not think it will. The figures are small ones, and I have given them. I should have hoped that in this case, rather more than in the cases lower down the scale of values, agreement might be almost always possible.
I believe that housing has this character about it: that a quite small number of hard cases can be terribly cruel to people. Though I should not expect to find many in this group, I do not see why we should take the risk of finding them and making them. The Minister can put things right afterwards if need be. Therefore, I believe that these Amendments are as misconceived as similar Amendments were in another place. I recognise the feeling that makes people put them forward, but I think, on

929
balance, it is the wrong feeling for this kind of regulation, and I therefore cannot accept any of these Amendments.
LORD MOLSON: I am sure we are all most grateful to the noble Lord the Parliamentary Secretary for the detailed and full reply that he has given. There is one thing, however, which I do not think ought to pass without notice. It is not very often that, in your Lordships' House, arguments are advanced on behalf of the Government that have not been previously advanced in another place, especially when a Bill has been in Standing Committee upstairs there and has been discussed very fully indeed. The noble Lord, Lord Mitchison, is right so far as I am concerned: I did not use Mr. Boyd-Carpenter's argument that the rents charged are usually twice, or more than twice, the rateable value. I had also done what research I could, and I was unable to find any justification for it. But the extraordinary thing to which I should like to draw your Lordships' attention, and especially that of the Government, is that the Parliamentary Secretary has told us that this argument was advanced no fewer than three times by Mr. Boyd-Carpenter, and on no occasion was it rebutted by the Minister responsible.
LORD MITCHISON: I am much obliged to the noble Lord for giving way, but I did not go as far as that. What I said was that, the way the debates went —as I think the noble Lord will find if he looks himself—it was not as definitely and fully answered as it might have been. It was protested against: the Parliamentary Secretary, Mr. MacColl, protested at one point. I noticed that.
LORD MOLSON: That very largely confirms what I said. How very satisfactory it is to think that we should have put down these Amendments in your Lordships' House and have obtained an answer from the Government here which was not vouchsafed to another place.
LORD HASTINGS: I am also most grateful to the noble Lord for having dealt at such length and in such detail with this very important subject—and I mean that sincerely, because this matter needs a thorough discussion at the beginning of our Committee stage and the noble Lord's reply has set the standard for the whole of our proceedings. He
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was very persuasive at the beginning of his argument, I will admit. I need not go again over the fundamental difference between us, about "control for control's sake," and so on, but I would point out that our Amendment does nothing to affect adversely the general security of tenure, the security from eviction, because that is, or will be, universal, and applicable to all tenants. It affects only minimally security of tenure in so far as that security is attached to rent regulation. The noble Lord has not said a great deal about that, and we feel that the regulation for the income groups involved is not necessary.
The noble Lord spent no time at all on dealing with the situation outside London—and it is very important. If the Government insist on keeping to their figure of £200 rateable value outside London, I have little doubt that he is going to exacerbate landlord/tenant relations and not improve them—and quite unnecessarily. As I repeat, to take over £150 rateable value outside the big conurbations (and London, of course) is completely unnecessary, and we feel that we must stick to our point on that particular matter.
Turning now to London, the noble Lord, of course, did not reply to my speech at all: he replied to Mr. Boyd-Carpenter in another place, whose arguments I never used once. I relied on the figures in the Milner Holland Report, and I would accept more or less his idea that the rent would be 1½ times. But I will emphasise again: not 1½ times the rateable value, but 1½ times the gross value. That is what the Milner Holland Report says in the table I quoted; and 1½ times the gross value is 1½ times £440, based on a rateable value of £350.
LORD MITCHISON: I am much obliged to the noble Lord for giving way. I abhor housing and rating statistics—and I do not believe that he really loves them, either—but the figure for all lettings in the table he has in mind is 1·12. That is the right figure in relation to the net rateable values. I added a quarter to it and so arrived at the 1½. It was only a rough figure.
LORD HASTINGS: The noble Lord is talking about averages, and it is very difficult to average things. I was talking about the percentage of housing let at

931
more than the gross value and up to twice the gross value; but there are very few houses of that kind. Therefore, it is roughly between once and twice the gross value. But we are already in a field of rent which is as low as £600, and one can hardly argue that this is an income group which needs protection. Therefore all his arguments against my right honourable friend in another place based on the falsity of the multiplier fall to the ground. We say emphatically that £350 is the right figure to make the operation of the Bill reasonable and to cover all the people who should be covered. After all, it is the Government's intention to deal with the urgent cases first, and there is no reason why they should worry about those in the other range.
The noble Lord said that there is no possibility of increasing the limit and that it is so easy to reduce it. But will this Government that we have ever reduce the limit? I do not think so. Really! we are not prepared to rely on that sort of bait. If the noble Lord is unable to accept this Amendment, I have no alternative but to ask my noble friends to follow me into the Division Lobby.
LORD MITCHISON: Before the noble Lord sits down, may I remind him that my right honourable friend the Minister of Housing did promise to look into this matter, in the light of experience, and, if he could, to reduce the limit.
5.12 p.m.
LORD SILKIN: I suppose that the noble Lord intends to divide the Committee, and I do not expect that anything I say will alter his decision. But on what is he dividing the Committee? He is dividing the Committee on the issue of whether, in London, the rateable value should be £350 or £400. Is that an issue on which the Committee is able to form a positive opinion? The issue is so narrow between one and the other that I should have thought the wise thing would be to accept the £400, with the assurance that the matter will be looked at again.
BARONESS HORSBRUGH: May I ask the noble Lord whether, if this issue is so narrow—and I agree with him that it is—he can induce his noble friend to accept the Amendment?
LORD SILKIN: No, I do not think so; because I am going to give other reasons for the £400. The noble Lord said that this was not needed for the purpose of giving security of tenure to people in the range between £350 and £400 because they are already protected from eviction. But, in fact, all they would be protected from would be eviction without a court order. But, in many cases, the court would have no discretion; so the tenants would not have that security of tenure which I think they ought to have.
I am a little surprised at the nature of these Amendments because we are seeking to protect a class of persons not normally looked after by any section of the community: the middle class. We seek to protect the middle-class person who seeks accommodation in London and in the conurbations outside; who has to live in London because of his job; who is unable or not prepared to buy a house; who very often cannot get a mortgage; who has to have rented accommodation and who, in most cases, because of the scarcity of rented accommodation available, has to get a flat. I would ask the noble Lord to agree, from his own experience, that a middle-class family man seeking a flat in the central part of London—in, say, Kensington, Chelsea, Paddington or Marylebone—would have to pay something in the order of at least £700 to £800 a year. Is not such a person worthy of protection against exploitation? I am not suggesting that there is widespread exploitation; but there is a certain amount of it. And we all know that there is still a shortage of that kind of housing in London, and that there is a danger of exploitation. Why, therefore, should not that kind of person, admittedly with an income of perhaps £2,000 or £2,500 a year gross, have the same sort of protection as will be given to people with a lesser income. I was under the impression that the Party opposite were anxious to protect that kind of person. Evidently they want to throw them to the wolves. We are out to protect them.
If it turns out eventually that the number of dwellings available becomes so great that there is a freedom of choice, and a freedom to negotiate a rent, then the Government have given an undertaking that they will reduce the limit.

933
Until that time comes, and the Government are satisfied that they can reduce, I am sure that the right thing is to stand by the figure in the Bill. I hope that the Opposition will be content to accept the assurance that has been given. I know that the noble Lord is doubtful whether he can really believe the Minister, but I would ask him to accept the assurance that this question will be looked at when the time comes with a view to a reduction in the rateable value.
LORD OGMORE: Before the noble Lord, Lord Hastings, speaks again I should like to take up one point which was put by the noble Lord, Lord Silkin, when he said that no one in this country is interested in the middle class. The Liberal Party are most interested in the middle class, as in all other classes; but I support his argument about the young people in London. This is a very real problem. Like him, I do not see why the young couple in London who have to find accommodation in Kensington and other areas should not have equal protection. If we are to have rent control, it should affect people of all types and of all income groups.
I was surprised that the noble Lord, Lord Hastings, should assume that the Labour Government are going to continue in office perpetually; for that is what he seemed to imply. It may be so; but it was surprising to hear it from the Conservative Front Bench. He said that he could never imagine the Labour Government reducing the amount, even if they felt the time had come to do so. That was his implication. But, presumably, they will not be in office for ever; the Conservatives may be in office and the Conservative Government could look at it and make up their minds—or perhaps the Liberals will be in office. They will certainly look at all these problems and make up their minds. I do not want to delay the Committee. I agree with
the noble Lord, Lord Silkin, in hoping that the Committee will support the Bill and reject the Amendment.
LORD NEWTON: I do not want to make a long intervention, but I feel that some brief reply should come from these Benches in answer to Lord Silkin in his admittedly reasonable plea, to the effect that we on this side were being unreasonable. But it seems to me that the noble Lord, Lord Silkin, was really arguing against his noble friend, Lord Mitchison. The trend of Lord Silkin's argument was that everybody should be protected in London, and that there should be no upper limit to the rateable value.
LORD SILKIN: I would go so far as to say that, so long as there is a housing shortage in any category, it ought to be protected. In our opinion, we have at the moment the right range.
LORD NEWTON: That seems to me a slight qualification of the general trend of the noble Lord's argument. Obviously you could make out a case for everybody being protected in case someone, however luxurious his dwelling, might be exploited. The noble Lord, Lord Mitchison, faced this and said it would have been logical to have no upper limits, but he thought that was going too far. There is at any rate this agreement between the Government and us, that there ought to be upper limits. The argument is where the upper limits should be. My point is that if we are to have upper limits of rateable value written into the Bill we should try to get them in the right place. That is what is between us.
5.22 p.m.
On Question, Whether the said Amendment (No. 1) shall be agreed to?
Their Lordships divided: Contents 62; Not-Contents 54.

CONTENTS

Ailwyn, L.

Carrington, L.

Fortescue, E.

Albemarle, E.

Denham, L. [Teller.]

Fraser of Lonsdale, L.

Allerton, L.

Derwent, L.

Gage, V.

Atholl, D.

Digby, L.

Greenway, L.

Auckland, L.

Dilhorne, V.

Grenfell, L.

Balerno, L.

Ebbisham, L.

Grimston of Westbury, L.

Balfour of Inchrye, L.

Elliot of Harwood, Bs.

Hastings, L.

Barnby, L.

Emmet of Amberley, Bs.

Hawke, L.

Bessborough, E.

Erroll of Hale, L.

Horsbrugh, Bs.

Blackford, L.

Falkland, V.

Hurd, L.

Bridgeman, V.

Ferrers, E.

Ilford, L.

Brooke of Ystradfellte, Bs.

Forster of Harraby, L.

Jellicoe, E.

Killearn, L.

Mowbray and Stourton, L.

Somers, L.

Kinnoull, E.

Newton, L.

Strange of Knokin, Bs.

Lambert, V.

Poulett, E.

Stuart of Findhorn, V.

Lothian, M.

Ridley, V.

Swinton, E.

Malmesbury, E.

St. Aldwyn, E. [Teller.]

Ullswater, V.

Margadale, L.

St. Helens, L.

Wakefield of Kendal, L.

Massereene and Ferrard, V.

St. Oswald, L.

Wolverton, L.

Molson, L.

Sandford, L.

Woolton, E.

Monson, L.

Selkirk, E.

NOT-CONTENTS

Addison, V.

Henderson, L.

Rhodes, L.

Airedale, L.

Henley, L.

Segal, L.

Archibald, L.

Hilton of Upton, L.

Shackleton, L.

Attlee, E.

Hobson, L.

Shepherd, L.

Beswick, L. [Teller.]

Hughes, L.

Silkin, L.

Bowles, L. [Teller.]

Kirkwood, L.

Simey, L.

Brockway, L.

Latham, L.

Sinha, L.

Burton of Coventry, Bs.

Leatherland, L.

Snow, L.

Byers, L.

Listowel, E.

Sorensen, L.

Champion, L.

Lloyd of Hampstead, L.

Stonham, L.

Chorley, L.

Longford, E. (L. Privy Seal.)

Taylor, L.

Cohen of Brighton, L.

Merrivale, L.

Wade, L.

Colwyn, L.

Mitchison, L.

Walston, L.

Douglas of Barloch, L.

Morris of Kenwood, L.

Wells-Pestell, L.

Gaitskell, Bs.

Morrison, L.

Williams, L.

Gardiner, L. (L. Chancellor.)

Ogmore, L.

Williamson, L.

Haire of Whiteabbey, L.

Phillips, Bs.

Winterbottom, L.

Hampton, L.

Plummer, Bs.

Wynne-Jones, L.

On Question, Amendment agreed to.

Resolved in the Affirmative, and the said Amendment agreed to accordingly.
On Question, Whether Clause 1, as amended, shall be agreed to?
LORD HASTINGS: I have one or two points to put to the noble Lord, because this is a complicated clause. First of all, in line 3, are the words, "on the appropriate day". What is going to happen at the next quinquennial valuation? I take it that it is the intention of the Government that the limits, which we have now amended, will remain for all time and that a dwelling would not come out of regulation simply as a result of its rateable value being increased in the quinquennial valuation. That would be a protection, from the point of view of the Bill, against the process of inflation.
But suppose that on the appropriate day a house in the country with a rateable value of £140, so coming within the limit of £150 now fixed, is improved—and it is easy to spend £500 or £1,000 on improvements, for example, on central heating—and the rateable value goes up to, say, £170. Will the revised rateable valuation resulting from these improvements automatically release from rent regulation, if the new valuation is higher than the limit? I think that it is important that we should know this now,
936
because if this is not so, it could prove discouraging to landlords wishing to improve their houses.
On page 2, subsections (4) and (5) are very involved and I should like to be clear in my own mind about what is a statutory tenancy. In the past, we have been used to referring to a statutory tenancy as a tenancy of rateable value limited to £40 in London and £30 in the country. Now we find that "statutory tenancy" is going to be used in a different sense. It would appear that immediately the Bill comes into force a contractual tenancy would become a regulated one. I am not sure from subsection (5) whether, after it becomes regulated and there is a change of tenancy or the lease falls in and the sitting tenant gets a new lease, that would be a statutory tenancy. I wonder whether the noble Lord could elucidate this obscure point, because in Clauses 3 to 7 we find the word "statutory" used in a sense to which we are not accustomed and it is not always easy to know what is meant.
LORD MOLSON: There is one other point I should like the Parliamentary Secretary to deal with, which is connected with the point made by my noble friend Lord Hastings. It is this matter of "on the appropriate day". My noble friend referred to the possibility of there being

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improvements made to a house which would result in increasing its rateable value in between the quinquennial valuations. We know that there is likely to be a Bill consolidating all the Rent Acts and it may be that this Bill will be caught up in that consolidation; therefore, it may be a long time before there is a complete change in the law. I take it that that would mean that when the new quinquennial period arises, when there is a complete reassessment of rateable values throughout the country, even though the rateable value of a house had gone above these limits it would still remain within the purview of the Rent Acts because it would have had its rateable valuation on the appropriate day. That seems to me to be undesirable. We do not want undue rigidity in this matter. When a new rateable valuation is arrived at in the next quinquennial valuation, it is desirable that the question of what should or should not be controlled under the Rent Acts should depend upon the new valuation.
LORD MITCHISON: I am asked two questions. The first is what is "the appropriate day" or, if I may put it another way round, "the rateable value of which on the appropriate day did not exceed" the limits laid down in the Bill. The appropriate day is defined in Clause 40(3) and I venture to think that the definition is pretty clear. It has to cover various cases, but where there is a dwelling house on the valuation list on March 23, 1965, then the appropriate day is that day. Broadly speaking, if it appears on the valuation list or roll after that, it is the day on which it first appears.
LORD HASTINGS: Before the noble Lord leaves that point, I know what the appropriate day is under the Bill. What I want to know is the effect of this definition in regard to improvements which may have been carried out after the appropriate day and resulting in the rateable value going over the ceiling.
LORD MITCHISON: All I am trying to answer, and I repeat it, is the meaning of the words "appropriate day" in the third line of subsection (1) of Clause 1 of the Bill. In normal cases of the house existing now the appropriate day is March 23, 1965. As I read the Bill, that is not affected by improvements or
938
changes. But there is also the case where there is a new house which did not appear on the valuation roll, and then it is the date on which it so appears. That is the way in which I read the subsection. I may point out that, while we know what we are putting forward, in the last resort the construction of a clause of this sort is a matter for the courts. But that is what I understand it to mean.
The second point is: what is a statutory tenancy? A statutory tenancy is also defined. It is the last definition in subsection (1) of Clause 45 of the Bill, and it has the same meaning as in the Act of 1954, or, as the case may be, the Scottish Act of 1954. I must admit that if your Lordships are intensely curious about the Scottish Act of 1954 I should have to ask my noble friend to expound it, which no doubt he would do. But, so far as the English Act is concerned, this is the ordinary statutory meaning, and there is nothing peculiar about it. I notice that in the textbook that I have on the Rent Acts there are about twenty pages dealing with statutory tenancies. They are not contractual tenencies. I do not know whether there is anything more the noble Lord would like me to say in that respect.
LORD HASTINGS: The noble Lord has done his best, but I am not very much the wiser. We may be able to elucidate it if we go on to other clauses.
LORD MITCHISON: I can only say that I hope when it is read it will read better than it sounds. If I can pick it up in the shortest and simplest language, "appropriate day" has the meaning in the subsection I have indicated, and "statutory tenancy" has the meaning at the end of the other subsection to which I have referred.
Clause 1, as amended, agreed to.
Clause 2 agreed to.
Clause 3:
Limit on contractual rent.
3.—
(3) Where no rent for the dwelling-house is registered under this Act (whether or not Part II of this Act is in operation in the area in which the dwelling-house is situated) the said limit shall, subject to any adjustment under section 4 of this Act, be—

939
(a) if not more than three years before the regulated tenancy began the dwelling-house was the subject of another regulated tenancy, the rent payable under that other tenancy (or, if there was more than one, the last of them) for the last rental period thereof;
5.44 p.m.
LORD HASTINGS LORD HASTINGS moved, in subsection (3)(a), to leave out "three years" and insert "one year". The noble Lord said: We come now to this confusing matter of regulated tenancies and the tenancies changing. I take it that the sitting tenant at the time when the Act comes into force will be enjoying a contractual tenancy. Subsection (3)(a) envisages the situation where a lease comes to an end, the tenant wishes to continue and he gets a statutory tenancy; or he may leave at any time he likes and the new tenant will get a statutory tenancy and the rent will be based on that of the previous tenancy, referred to here as a "regulated tenancy". That must be after the Act comes into operation, because there is no such thing before it comes into force. Therefore we are dealing with the second tenant or a continuing tenant on a new lease.
It is laid down that for three years after that change of tenancy it will not be possible to alter the rent unless you go to the rent officer and get a new rent registered. According to this, you cannot even agree upon a higher rent. I think the Government would like to see agreed rents as much as possible. You can get a higher rent only if you go to the rent officer. If this is so, why for a period of three years after the Act comes into force should there be this freeze on the second tenancy? Does this mean that you are not going to have a rent officer available for more than three years after the Act has come into force? Surely that is not the intention of the Government. It is not what the noble Lord's right honourable friend the Minister said in another place. If these rent officers are going to be functioning in the reasonably near future, it cannot be necessary for a second tenancy like this to be frozen for three years.
The reason why I have put one year in this Amendment is to make quite sure that it is not an unnecessary freeze, and that the case can be taken to the rent
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officer within a reasonable period. This means that, even if the sitting tenant goes within a month of this Bill becoming law, it should be possible to get the rent reduced, if the landlord or the tenant wishes to do so, a year later, and they will not have to wait three years. This seems to me to be a fairly reasonable point to make. I beg to move.
Amendment moved—
Page 3, line 16, leave out ("three years") and insert ("one year").—(Lord Hastings.)
THE MINISTER WITHOUT PORT-FOLIO (LORD CHAMPION): As I think the noble Lord said, the effect of this Amendment would be to reduce to one year from three years the period between regulated tenancies beyond which the rent payable under the earlier tenancy would not constitute a rent limit for the second tenancy. This is the point the noble Lord is arguing. As I am sure he has recognised, the theory behind this subsection is this. After the initial period of rent freeze has ended, with the coming into force of Part II of the Bill (and the period of the freeze will be as short as is practicable; as the noble Lord said, the Minister of Housing and Local Government has promised to get his machinery for this into operation as soon as it is humanly possible to do it), it will be open to the landlord of any regulated tenancy to refer the tenancy to a rent officer to fix a fair rent. A fair rent, so fixed, cannot be challenged by either of the parties acting alone for a period of three years, except on the ground of a change in circumstances which invalidates the fairness of the rent previously fixed. I am sure the noble understands that.
This is designed to prevent constant references to the rent officer of tenancy agreements for which fair rents have been properly settled. Three years seems to us to be a reasonable period to elapse before a right of review is given. If the landlord of a regulated tenancy does not refer the rent to a rent officer, it seems a fair assumption that he is satisfied with the amount so obtained, and the rent can, therefore, be allowed to stand for three years as the limit of any tenancy of any accommodation, subject, of course, to the variation that can be made to meet changes of circumstances, such as repairing liabilities, the cost of services

941
et cetera. It is open to the landlord, if no fair rent has been registered, to ask for a fair rent to be fixed, if need be, by asking for a certificate of fair rent under Schedule 4.
We do not think that three years is an unreasonable period in this connection. Three years is the period fixed for a tenant who is in occupation before a change can be asked for. This is reasonable. It would seem to us to be equally reasonable, having regard to the fact that the rent is a regulated one, for the period of fixing the rent for a subsequent tenancy to be based upon that which had existed before the tenancy changed. Three years seems to us to be a reasonable period in both cases, and I hope that the noble Lord will agree not to persist in his Amendment.
LORD HASTINGS: I am a little puzzled by what the noble Lord has tried to explain to me, clearly and very patiently. My understanding of this clause, which is entitled "Limit on contractual rent", is that it is dealing with the position before any rent has been registered. I entirely agree that three years is a reasonable period between the last registration and the next registration, except for special reasons. But this appears to be dealing with the period of freeze before the machinery is set up and the rent officer is available. It seems to me that it should be possible for a landlord, on getting a new tenant into his house before any rent is registered for that house, to go to the rent officer in less than three years. That is my understanding of the clause—of course I may have misread it—and it seems to me that the noble Lord's argument dealt largely with the period between one registration and another. I am dealing with the period before any registration. It seemed to me that the period of three years was unreasonably long.
LORD CHAMPION: This is dealing with a position under which there is a regulated tenancy.
LORD HASTINGS: A contractual rent.
LORD CHAMPION: A contractual period of a regulated tenancy. I am not sure that this applies to the period of only the rent freeze. It is not intended
942
to do that. It is intended to cover the changes of tenancy which can take place, and quite clearly may take place, in this period.
LORD MOLSON: Does this three-year period prevent the raising of the rent under the procedure for a regulated rent at the time when it begins?
LORD LLOYD OF HAMPSTEAD: I should have thought that it was clear that under this clause the landlord will be entitled, as soon as the other part of the Act comes into operation, to apply to the rent officer. This is dealing merely with the situation before the rent tribunal system is set up. This enables a rent to be fixed in the preliminary stages by reference to the contractual rent.
LORD HASTINGS: That is exactly what I said. We go back to subsection (5) of Clause 1, referring to a contractual tenancy and a contractual period, which I have understood to mean the sitting tenant under a lease. The difficulty in interpretation is tremendous. I have no intention of pressing this Amendment, but I would ask the noble Lord to look at the clause again to see whether perhaps my reading of it, and the reading of the noble Lord who has just intervened, is not the correct one, and that it deals only with the preliminary period. If it does that, I feel that one year, or perhaps, if necessary, two years, would be ample, but that three years is too long. Three years is the right period between registrations.
LORD LLOYD OF HAMPSTEAD: Of course, one might add that this three years is not a three-years freeze, because as soon as the machinery is set up an application can be made to the rent officer. It tells you merely that it is in relation to such a tenancy that you fix the rent.
LORD HASTINGS: That is my point, because I want the rent officer system to be set up so that it can be referred to him in less than three years. That is why I put down one year.
LORD MOLSON: It is helpful to have an intervention from the Back Benches, especially from so weighty an authority, but we shall require an authoritative answer from the Front Bench. It is not made any simpler by the fact that the

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noble Lord, Lord Mitchison, shook his head, while the noble Lord, Lord Champion, nodded his head.
LORD CHAMPION: But some people mean different things by different nods! The fact is that the maximum specified by this subsection, which may vary up or down in accordance with the provisions of Clause 4, is as follows. In the case of the tenancy subsisting when the Bill comes into operation, it then becomes a regulated tenancy—the rent payable under the terms of the tenancy as they stood immediately before the Bill came into operation. In other words, it will be frozen. In the case of a dwelling-house which is let for the first time on a regulated tenancy, by a tenancy which begins after the Bill comes into operation, the rent agreed between the landlord and the tenant will be the rent on that letting.
I know that this matter is frightfully complicated, and if I understood it I could explain it better. But such explanation as I have received convinces me that we are right in taking the three years, as against the one year proposed by the noble Lord opposite. I will carefully consider what he has said, and if by any chance it should appear before the Report stage that it is advisable to do something about it, we will. But I am not making any firm promise on this, because we feel—and those who have looked into this very carefully are sure—that the three years, as against the one year, would be the right period, even with the change of tenancy for which this clause provides.
LORD HAWKE: I am deeply in sympathy with the noble Lord, Lord Champion, because he has got enmeshed in a lawyers' jungle. He has given the impression, and the general public could get the impression, that the Minister may take three years to set up his scheme, and that is a very bad impression to give. I suggest that he should look into the question seriously, if only for the purpose of giving more confidence to the public in the scheme he is setting up.
LORD CHAMPION: The only thing I would say in answer is that I think there have been fairly clear undertakings that it will take nothing like three years to set up the scheme. It will come into operation in a period of something like
944
six months. This will depend on the administrative arrangements. But it will certainly not be three years. It would amaze me if such a period were taken to set up a scheme.
LORD HASTINGS: No doubt the noble Lord and his advisers will read carefully in the OFFICIAL REPORT what has been said, and I would be grateful if he could let me know by correspondence whether or not my interpretation of this clause is right. If it is not, then three years is all right. If it is, then I think a period of one year is sufficient. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
On Question, Whether Clause 3 shall be agreed to?
LORD HASTINGS: I am afraid I have not quite finished on this clause. It appears to me that in subsection (3)(b) no allowance is made for a new tenancy in a house which is empty at the time the Act comes into force. I do not know what the position will be if, quite coincidentally, a landlord has many empty houses at the time when this Bill comes into force. On what is the rent of the tenant to be based when that house is let?
LORD MITCHISON: This is a clause imposing limits on the contractual rent. It is not a clause which lays down the contractual rent in any sense. It simply says that in various circumstances the rent must not exceed so-and-so. If one looks at this, Clause 1 obviously applies, because that is perfectly general. The clause states:
"would exceed the limit the amount of the excess shall … he irrecoverable …"
That is, as it were, the teeth in the whole Bill. Then subsection (2) says:
"Where a rent for the dwelling-house is registered under this Act the said limit shall be the rent so registered".
There may or may not be a registered rent in the case of an empty house. It depends entirely how and when and in what circumstances it has become empty. The third case is—and this was the one that I think caused a little trouble last time—that where there is no registered rent, the limit shall be either (a) or (b). These are still limits and (a) is the case of a regulated tenancy preceded, at an

945
interval of less than three years, by another regulated tenancy. In that case it is the other regulated tenancy—the first of them in time—which gives the limit and then in any other case (this is still, however, only applicable to a case where there is no registered rent) the limit is the rent payable under the terms of the lease or agreement creating the tenancy subject to variation by another agreement.
I hope I have made it fairly clear. I think the point about the clause is that it does not really lay down anything; it simply sets limits, and though those limits are in some cases dependent upon the terms of the machinery of the Bill, and in others dependent upon agreement, that is all they are.
Lastly, may I say just one general thing about clauses with limits. I do not think there are any holes in this one. but if there is a clause imposing limits and one finds a case which resembles the limited cases but is not one of them, then obviously the limit does not apply.
LORD HASTINGS: After reading out the clause in extenso, the noble Lord, I think replied to my question in his last sentence; and he said that there would be no limit. The house is vacant at the time the Bill comes into force and therefore there is no previous regulated tenancy; then a tenant comes in. and I cannot see on what basis the rent is to be limited.
LORD MITCHISON: Let me give the noble Lord the simplest instance. Under subsection (2) let us assume that the rent for the dwelling-house is registered under this Act, and that a week or a year afterwards the tenant goes out, for whatever reason, leaving the house empty. In such a case there is still a registered rent.
LORD HASTINGS: But I am saying that the house is empty before the Bill becomes an Act.
LORD MITCHISON: I thought the noble Lord said that it could never apply to an empty house. There can have been no registered rent when the Act came into operation—the house was empty at the time. Consequently, there has been, and there is, no registered rent at all, and therefore I agree that in those circumstances subsection (2) does not apply.
946
Further, since no rent for the dwelling-house is registered, subsection (3) does not apply, but subsection (1) does, and subsection (1) is the case, called, shortly, the machinery case, where people can go and agree a rent and go to the rent officer or, if need be, to the rent assessment committee, and the whole machinery is set in operation. The point, if I may say so with respect, is that this Bill attaches to houses. That is to say, it may be a matter of agreement between people; but provided that the houses are of a kind covered by the Bill, then, through the machinery of the Bill, they are subject to regulation. It does not follow of course, that they will always need to be regulated. The empty house may be omitted as long as it is empty, but not when it is full.
LORD HASTINGS: I think I understand now. If a landlord has a vacant house, he fixes a rent with his tenant, and then, when the rent is registered and it happens to be lower, because the tenant disagrees, the landlord cannot get the rent he had formerly agreed upon. That is the effect of subsections (1) and (2) together. It is very difficult to understand, but I follow it now. I thank the noble Lord very much.
Clause 3 agreed to.
Clause 4:
Adjustment, before registration of limit imposed by section 3
4.—
(5) If an improvement has been effected in the dwelling-house and the improvement was completed after the commencement of this Act and after the time as from which the rent for the previous tenancy was agreed or, as the case may be, the previous terms were agreed, the said limit shall be increased by twelve and a half per cent. per annum of the amount expended on the improvement by the landlord or any superior landlord or any person from whom the landlord or any superior landlord derives title.
LORD NEWTON LORD NEWTON moved, in subsection (5), to leave out the first "and" and insert "or". The noble Lord said: I only hope that this Amendment does not land us in quite such difficulties as the last Amendment moved by my noble friend Lord Hastings. This relates to Clause 4, which deals with the assessment of rents in respect of improvements. Subsection (5) of this clause starts in this way:
"If an improvement has been effected in the dwelling-house and the improvement was

947
completed after the commencement of this Act and after the time as from which the rent for the previous tenancy was agreed or, as the case may be, the previous terms were agreed, the said limit shall be increased by twelve and half per cent. per anum of the amount expended on the improvement …".
I may be wrong about this, and I may not be capable of understanding the proper meaning of this subsection, but it appears to me to imply that the landlord will get no increase at all in respect of an improvement which was completed between the date on which the last tenancy agreement was made and the commencement of the operation of this Act. In other words, if we consider a house which has been undergoing an improvement and the improvement was completed to-day, my interpretation of this subsection is that the landlord would not in due course get any increase in his rent because the Act had not commenced. On the other hand, if the Act had commenced yesterday and the improvement were completed to-day then it appears to me that the landlord would get his increase. If my interpretation is right, it seems to me to be a little unfair that because a useful and valuable improvement was effected to a house before the operation of the Bill the landlord should not get the benefit from it in regard to the rent.
LORD CHAMPION: This is an Amendment which I think I understand, and I hope and think I understand the reply to it. The effect of this Amendment would be to allow the landlord, prior to the registration of a fair rent, to agree with the tenant an increase of the frozen rent to take account of an improvement to the dwelling-house provided that the improvement was completed either after the coming into operation of the Bill or after the time as from which the rent of the previous tenancy was agreed (where the recoverable rent is fixed by reference to the rent under a previous regulated tenancy) or after the time as from which the previous terms were agreed (in the case where the recoverable rent is fixed by reference to the rent payable under the terms of the subsisting tenancy as varied, in the case of a tenancy which began before the commencement of the Bill, by any agreement made before that date).
948
Clause 4(5) as drafted provides that, in order to agree such a rent increase, the improvement must be one which has been effected after the coming into operation of the Bill, and after the time as from which the rent of the previous tenancy, or, as the case may be, the previous terms, were agreed. The noble Lord seemed to be urging in support of the Amendment that Clause 4(5) as drafted prevents a landlord from agreeing a rent increase on account of an improvement if the improvement is one which was completed before the coming into operation of the Bill, but the landlord, for one reason or another, had not agreed an increase of rent with the tenant which reflected the value of that improvement. I think that, so far, I am right.
As against this, we think it can be urged that a rent freeze must necessarily be based on the supposition that at the date it commences—in this case on the coming into operation of the Bill—the landlord will, by and large, be obtaining the full economic rent for that property. The Bill has, as everybody knows, received a fair amount of publicity while passing through the other House and coming to ours. It will be known to landlords what the Bill contains and how it will work. I cannot imagine that landlords will fail to take account of the fact that they ought to be charging the full permissible economic rent, which will include improvements, on the day the Bill actually comes into operation.
In connection with this whole business of charging additional rent for improvements, Section 5 of the Rent Act 1957 should be taken into consideration, because this makes a similar provision and does not allow for improvements that took place before the operation of that particular section. The Opposition at that time took the view that the landlord of a controlled tenancy who had failed to increase the standard rent in respect of an improvement which he had completed before the coming into operation of the Act should not be able to increase the rent limit under the Act to take account of that improvement.
There is also this factor in this Amendment: the acceptance of it would allow a landlord in some cases to agree with the tenant a double increase for an improvement. For example, a landlord might complete an improvement before

949
the coming into operation of the Bill and agree with his tenant that the rent should be increased to take account of the improvement from a subsequent date being a date which falls after the coming into operation of the Bill. In such a case it would be open to the landlord, were the Amendment moved by the noble Lord, Lord Newton, to be accepted, to seek to persuade the tenant to agree to a further increase of not more than 12½ per cent. of the amount he had spent on the improvement to be added to the rent already agreed as reflecting the value of the property as improved. It seems to us here that there is a possibility of a double increase for the same improvement. This clearly must be avoided. There is also the point I made at the outset, which I think the more important one, that landlords will already have taken advantage of the previous Acts, where they apply, to ensure that the maximum legal rent permissible, including that for the improvement that has been made, will be the rent on the day to which this particular clause applies.
LORD HAWKE: I approach this Bill purely from the point of view: is it fair or is it not fair? In many respects, I think it is a very fair Bill. My brief on this particular Amendment, drafted by eminent lawyers, says this appears to be a drafting Amendment, in which case I think it is somewhat mistaken. Leaving aside this question of possible double increase, surely it is unfair, if an improvement has been started and the corresponding increase in rent has not been agreed, that the landlord should be precluded from obtaining that through the passage of this Bill. I should have thought it would be perfectly possible to draft some clause to meet that point while, at the same time, excluding the possibility of double increase, which, of course, would not be fair.
LORD NEWTON: I am bound to say I had not envisaged the possibility of a very cunning landlord managing to get a double increase as the result of this Amendment, but I am prepared to accept from the noble Lord that it is a possibility. Of course, if it is a possibility it is one which should be avoided. I should like to read rather carefully exactly what the noble Lord said. I think it is satisfactory. If I understood
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him aright, the main argument was this: that as soon as a fair rent is registered for the house in question that fair rent will take account of any improvements made to the house in the past, no matter when they were made. It seems to me on the face of it to be reasonable, but of course it reinforces the need to make absolutely certain that the machinery for registration of rents comes into operation as soon as possible. Otherwise, I think it would be unfair to the landlord who has made an improvement in good faith and has to wait a long time before he gets the benefit of a higher rent. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
6.17 p.m.
LORD MOLSON LORD MOLSON moved, in subsection (5), to leave out "twelve and a half" and insert "twenty". The noble Lord said: Your Lordships will be glad to know that this Amendment is not a matter of drafting. There are no technicalities about it at all. It is based upon a general consideration which I have urged upon previous Ministers of Housing and Local Government. It results from experience that I had when I was on the rural housing sub-committee of the Central Housing Advisory Committee. When you have a controlled rent, it often is the case that it is for an old house without modern conveniences. Ministers of all political complexions have wanted to give inducement to landlords to improve cottages of that kind. Under the first legislation a controlled rent could be increased only by 8 per cent. of the cost of the improvement, and in subsequent legislation that 8 per cent. was increased to 12½ per cent. I am proposing that it should be raised to 20 per cent.
In the case of some of these controlled tenancies it is very difficult to induce a landlord to spend money upon carrying out these improvements. He regards the investment as being an unprofitable one. The rent charged is not an economic rent which enables him out of his income easily to maintain the cottage and to carry out necessary repairs. A considerable number of those who own cottages of this kind are people of very limited means. To ask such a man to find the money, often to borrow the money, in order to put in modern improvements, and then allow him to increase the controlled rent only

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by 12½ per cent., which means it is eight years before he gets back his expenditure upon the house, is not an inducement to a rich man, and it is frequently not enough to enable a poor man to do it.
It is of the utmost importance that we should get the bad houses in the country improved. It has been found that the improvement is not taking place fast enough. It is not always possible to let one of these cottages which has been improved in that way continuously all the time. I believe it would be a valuable inducement to landlords to carry out these improvements if they were able to get a return of 20 per cent. instead of 12½ per cent. It would not alter the conditions already existing in the Rent Acts, in that the consent of the tenant would be required. I have urged this Amendment upon previous Ministers, and I hope that this Government may be prepared to regard this as a practical measure of speeding up the improvement of housing, especially in the countryside. I beg to move.
Amendment moved—
Page 4, line 19, leave out ("twelve and half") and insert ("twenty").—(Lord Molson.)
6.20 p.m.
LORD WOLVERTON: I should like to say a little on this Amendment. My noble friend Lord Molson has much more experience than I have on this, but of course there is the other side of the question which must be put. It is not always the case of a landlord not being prepared to make the improvements, but whether the tenant can afford the extra rent for the improvements. Sometimes the higher the interest required for the landlord to get his money back quickly the less likelihood there is of getting the improvements done. Recently I was told by a public health officer in my own area of Newmarket that he had done a survey on a large number of houses which were not individually owned but owned by one owner, with a view to trying to get the houses modernised. It was found that a few of the tenants could not afford it. Sometimes the improvements cost as much as the original rent.
While I think my noble friend has a good point in saying that probably to-day 12½ per cent., although a high interest rate, is not quite enough—it ought to be
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14 or 15 per cent.—20 per cent. is a little high. If you take the minimum improvement of say £800, for a bath and a lavatory—it may cost a good deal more than that—at 12½ per cent. that is £96 He would get half of his £800, he would get £400, which is the limit under the improvement Act; so that would be an extra rent of £48 if he gets half of the improvement grant. I do not want to make it too high, but, as my noble friend Lord Molson says, to make it enough to give encouragement to the landlord to do these improvements. A great deal has been done, but there is a great deal more, especially in towns, to do. It is not only that the landlord is not willing to try to do the improvements. He could borrow the money. Often he can borrow it from his local authority; but the other half has to be paid fairly quickly. It is the tenant who cannot afford the improvement. The tenant may be an old-age pensioner. An improvement, at a high capital cost to-day, may cost him nearly double his rent. I should like to hear what the Government have to say on that. I would support my noble friend Lord Molson, because I think 12½ per cent. at the high interest rate of these days is not sufficient an incentive. I would put it at 14 or 15 per cent.
LORD COHEN of BRIGHTON: It seems to me that there might have been some logic in this Amendment when we had the old Rent Restriction Act. Then you could argue that the rents were so low that there had to be some kind of incentive for the landlord to improve his property, otherwise he was not getting anything like enough. But under this Bill all that has gone, and he will be getting a fair rent. To suggest a figure of 20 per cent. for any improvement is quite ludicrous. Any ordinary landlord, if he owns the freehold of the property, can borrow the money if the property is being improved, for 6 or 7 per cent. Then it is suggested that the unfortunate tenant must pay a further 13 per cent, which is a really ludicrous increase in the rent, in order to get certain repairs carried out. Imagine, £500 worth of repairs being carried out and an additional £2 a week having to be paid for them. It is not at all conceivable. I imagine that what would happen is that you would not get the property improved, because the increase was so extremely high, so completely out of relation to the general

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value of money that the tenant would not be willing for the repairs to be carried out because of the additional rent he would have to pay. So this Amendment defeats its own purpose. It just makes it impossible for the repairs to be carried out. I deal with property at 6 or 7 per cent. Twenty per cent. makes my blood run cold. I hope that the Committee will defeat this proposal.
LORD CHAMPION: I do not like to disagree with my noble friend, but we are here dealing with the period before a fair rent is registered, that is, while it is frozen. We think that Clause 4 rightly provides for this period. The noble Lord, Lord Molson, has rightly told us that the Housing Act 1961 raised the figure to 12½ per cent. from the amount that existed before; so that the figure of 12½ per cent. has been looked at by Parliament comparatively recently.
I am bound to feel that there was quite a lot in the points that were made by the noble Lord, Lord Wolverton, about the difficulty, perhaps, of paying 20 per cent. Here, we do recognise, as I think we are bound to do, that a difficulty exists about getting old houses improved. Wherever you go I think that you will find houses which clearly could be improved provided it was absolutely sure that the landlord, on the one hand, could get a return on the property. Of course, on the other hand, we have always to remember the tenant in this connection. It is not only the noble Lord who has thought of the difficulties of improving property. The Milner Holland Report has summarised the legislation in this respect, and pointed to the fact that the amount of improvement work that has been done up to now is distinctly disappointing. Although I believe that the noble Lord has put down his Amendment chiefly to air this point, in passing I must mention that his Amendment would affect the rent limit only during the period before a fair rent had been registered, because this is the only situation covered by Clause 4. It would be for that extremely limited period.
As I understand it, the Milner Holland Committee, and others who have considered this, have thought that the cost of these improvements and of assistance by the Government should take another form—namely, through the Finance Bill.
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We think that further thought will have to be given to incentives to the landlords to carry out improvements. We need not, and we do not, accept that a simple increase in the return which the landlord can demand is the only or the best way of stimulating more work of this kind. A reform of the taxation scheme in relation to such expenditure must be considered. The Government are not yet ready to bring forward new proposals covering improvement work to houses; but in the meantime, and before they are, we rather think that it would be unwise to attempt to alter the 12½ per cent. in this Bill for this limited period for which this particular clause operates.
I rather hope that with that explanation the noble Lord will be willing to withdraw his Amendment, because of the limited period involved plus the fact that we are not wholly satisfied—and clearly the noble Lord, Lord Wolverton, was not satisfied—with putting a figure of this sort in the Bill. I hope that the noble Lord will withdraw his Amendment, although I and the Government recognise that he has a point here so far as some means of securing improvement to property is concerned.
VISCOUNT GAGE: I rather hope that my noble friend will follow the advice given by Lord Champion. It is, or course, extremely difficult to apply common standards to places of very different types ranging from Islington to the depths of the country. As an agricultural landlord, I have been listening with amazement to some of the assertions made about the rent necessary to induce a landlord to improve his property. When one is dealing with very small rents such as we have in the country, an advance of a few shilling a week is neither here nor there. I feel that there may be other ways of inducing people to improve their property. There are, of course, advantages to be got from the Finance Acts in the way of eventually getting return on your capital. Those advantages are much more effective in getting an improvement to the sort of property with which I am familiar.
LORD MOLSON: I am most grateful to the noble Lord, Lord Champion, for the sympathetic way in which he replied to my speech when moving this Amendment. I am extremely glad to know that the Government recognise the great difficulty in which landlords find themselves

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in finding the money necessary for carrying out improvements. I entirely agree that there are many ways of doing it. I am glad to know that the Government are looking at the whole problem of taxation. The Milner Holland Report has drawn attention to the financial difficulties which arise in the matter. My purpose in putting down the Amendment was to draw attention to this matter, and I am more than satisfied with the reply the noble Lord has given. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
6.33 p.m.
LORD HASTINGS LORD HASTINGS moved, in subsection (7), after the first "shall" to insert:
"if not resolved by agreement in writing between the landlord and the tenant.").
The noble Lord said: This Amendment is quite straightforward and explains itself, though, curiously enough, a similar Amendment caused a great deal of discussion in another place. Subsection (7) of Clause 4 states that
"Any question whether … shall be determined by the county court or, in Scotland, the sheriff …"
There is no indication there that this question of rent, following upon the other subsections taking into consideration improvements, service provided, and so on, can and should be agreed between the landlord and the tenant. This is all the more peculiar when one looks at subsection (5) of Clause 6 where one sees exactly similar wording beginning:
"Any question whether …"
followed by:
"… shall be determined by agreement in writing between the landlord and the tenant or by the county court …"
In another place it was argued that no question could arise if there had been agreement, but one cannot use that argument in respect of subsection (7) if one does not use it also in respect of subsection (5) of Clause 6. The words "any question whether" are indistinguishable. It seems to me only logical, and purely in the interests of clarification, that one should make it quite clear that the normal process will be by agreement between landlord and tenant. Therefore, I suggested putting in these words
"if not resolved by agreement in writing between the landlord and the tenant".
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I see no reason why the Government should not accept a simple clarification of that nature. If they do not do so, there may be quite unnecessary trouble about this relatively small point.
Amendment moved—
Page 4, line 30, after ("shall") insert the said words.—(Lord Hastings.)
LORD MITCHISON: I agree that this is a small point, and one would wish to have it clear if clarification were required. But I am afraid that I agree with what my right honourable and learned friend the Attorney General said in another place, that the Bill is already perfectly clear, and in fact this Amendment might complicate matters a little.
May I put the complication very simply? The Amendment is to provide that any question, if not resolved by agreement in writing between landlord and tenant, shall be determined by the county court. But suppose they agree and do not put it in writing, what is the answer to that? I am content to follow the precedent set when the noble and learned Viscount, Lord Dilhorne, was Attorney General. He put in the Rent Act 1957, in Schedule 4, paragraph 5(5) these words:
"Any question whether compensation is payable under this paragraph or as to the amount of any such compensation shall be determined by the county court."
No one suggested that that could preclude an agreement. The fallacy is that when it gets to be referred to the court there must be "a question". If the parties have agreed there is no question to be resolved. That is the difficulty.
I have a couple more instances of the same form of words, but it is a quite usual one and does not seem in the least ambiguous. The Amendment would introduce a difficulty about a verbal agreement, as distinct from one in writing. I entirely agree with Lord Hastings that it is quite easy to look through an Act and find this kind of thing dealt with in different ways in different sections. Provided that they are a distance apart, I do not think that any harm is done. Personally, I prefer this form to the one which is sought to be substituted for it. We must remember all the time that we are dealing only with the comparatively narrow period before registration. Therefore, although this is the kind of thing

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about which one would like to be conciliatory, I do not think that it would be right to accept the Amendment. I hope the noble Lord will feel able to withdraw it.
LORD HASTINGS: I accept what the noble Lord has said, but he has not explained why it is put differently on the following page. What is the reason for insisting on determination by agreement in writing in one case and not in the other? I do not mind which way it is done, but I should have thought that it ought to be done in the same way.
LORD MITCHISON: This is a slightly different point. The point the noble Lord is putting to me is whether in Clause 6 one is justified in insisting on an agreement in writing when one does not do so in Clause 4.
LORD HASTINGS: Exactly.
LORD MITCHISON: It must depend on the subject under consideration. Clause 4 relates to a short period; it is a transitional sort of clause, referring to a period before registration. That in itself would seem to me to be the reason. All I am concerned about is that I want the Bill to be clear. If it is clear, I see no reason for altering it, unless you are going to make it clearer. I am bound to say that I do not think this Amendment would make it clearer. If it is intended, as I think the noble Lord's last intervention suggested, to ensure that any verbal agreement must go to the county court, then I think that is wrong. I have not looked sufficiently at Clause 6 with this in mind to comment at great length on this point, but perhaps by the time we get to the Question, "That Clause 6 stand part" I shall have an answer.
LORD HASTINGS: Perhaps I should have brought it up on the Question that the clause shall stand part, but as it was rather relevant to this Amendment I thought I should mention it. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 4 agreed to.
Clause 5 [Limit of rent during statutory periods]:
On Question, Whether Clause 5 shall stand part of the Bill?
LORD HASTINGS: I am sorry to keep bringing up these points. I do not really understand why Clause 5 is necessary and why, because it refers to a statutory period, it is any different from Clause 3, "Limit on contractual rent." I should have thought the matter was looked after by Clause 3. There is always confusion between this wretched use of the words "statutory" and "contractual".
LORD MITCHISON: I should have thought that Clause 3 was a narrower net than this one, and that Clause 5 covered the whole subject. I think that is the simplest explanation.
Clause 5 agreed to.
Clause 6 [Variation, before registration, of rent recoverable during statutory periods]:
LORD MITCHISON LORD MITCHISON moved, in subsection (7)(a), to leave out "an improvement" and insert "a" [grant]. The noble Lord said: This is a matter of little importance, but of a little character. This Amendment and Nos. 9 and 10 go together, and they are all directed to the case of schemes made under the Airports Authority Act, 1965. The schemes are for the purpose of protecting houses from noise and vibration, and they are authorised by a Statutory Instrument from the Minister of Aviation. Improvements so made would, of course, constitute improvements within the meaning of the Rent Bill, and in the case of a dwelling-house which was subject to a regulated tenancy in its statutory form the landlord would be entitled to increase the rent by 12½ per cent. of what he paid for doing the work. But in the case of most improvements, the tenant can apply to the county court for an order cancelling, or reducing, the rent increase on the ground that the improvement is unnecessary, or that too much was spent on it. This Amendment (I hope that this will not surprise and shock noble Lords opposite) comes from a Labour Government to protect the landlord, because we think that there is sufficient safeguard as regards reasonableness and cost where the scheme has to be put forward by the responsible Minister. For those reasons we require these alterations in this Bill. I beg to move.
Amendment moved—
Page 6, line 15, leave out ("an improvement") and insert ("a")—(Lord Mitchison.)
LORD NEWTON: I should like to thank the noble Lord for his explanation of these Amendments, and to say that naturally we are glad to agree with them. I do not quite know why the noble Lord thought we should be shocked or surprised at these Amendments coming from a Labour Government. I hope he will realise that although in my speech on Second Reading I talked, I thought rather disparagingly, about the mythology connected with the whole history of rent control in this country, I hope I have never said anything, either to-day or on Second Reading, which suggested that I subscribed to that mythology, on one side or the other.
LORD MITCHISON: I say at once that I have much too much respect and liking for the noble Lord, Lord Newton, to wish to say anything that might offend him in a matter of this sort. My remarks were not altogether serious, but it does not matter very much, one way or the other.
LORD MITCHISON: I beg to move.
Amendment moved—
Page 6, line 18, leave out first ("or").—(Lord Mitchison.)
LORD MITCHISON: I beg to move Amendment No. 10.
Amendment moved—
Page 6, line 19, after ("1959") insert ("or section 15 of the Airports Authority Act 1965").—(Lord Mitchison.)
On Question, Whether Clause 6, as amended, shall stand part of the Bill?
LORD HASTINGS: Has the noble Lord any comment on the point I raised on subsection (5)?
LORD MITCHISON: The point we are now considering is subsection (5) of Clause 6, and what is involved in that subsection is any question of whether, or by what amount, the recoverable rent for any statutory period is increased or decreased to take account of charges in the provision of services by the landlord, or the use of furniture and so on, and the provision is that the matter shall be determined by agreement in writing or referred to the county court. In this case the contractual
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tenancy is at an end, and the landlord can recover from the tenant the maximum recoverable rent whether he agrees to pay it or not. In these circumstances express provision has to be made for the alteration of the recoverable rent by agreement between the parties. It is a special case, and I may add that I think it is right in this case, though not in the other, to make it essential that the agreement should be in writing. It is a far more complicated matter and covering a different state of affairs.
LORD HASTINGS: I am grateful for the explanation. I shall look forward to reading it more carefully to-morrow in the OFFICIAL REPORT.
Clause 6, as amended, agreed to.
Clause 7 [Effect of registration on rent recoverable for statutory periods]:
LORD MITCHISON LORD MITCHISON moved, in paragraph (b), to omit "four weeks from" and to substitute:
"the date on which the rent was registered nor earlier than four weeks before".
The noble Lord said: Clause 7 at present provides that where an increased rent is registered under the rent-fixing machinery—that is to say, by the rent assessment committee or by agreement with the rent officer—in the case of a statutory tenancy, the landlord must serve a notice of increase on the tenant giving him four weeks' notice of the increase. Where the rent is decreased the lower rent will come into effect from the date of the application for registration, failing a decision otherwise from the rent officer or the rent assessment committee. In another place the Opposition argued at two stages in the progress of the Bill that as a matter of fairness, so that there was no delay in making a decrease effective, a landlord should not have to wait four weeks for an increase to come into effect.
The four weeks' advance notice comes from the Increase of Rent and Mortgage Interest (Restrictions) Act, 1920, and that had a rather different intention. When this matter was considered in another place in Committee, the Joint Parliamentary Secretary accepted that there was a case for saying that this increase ought to be made payable forthwith, because the tenant has had a chance to prepare to pay for the increase, and on Report stage he undertook to arrange

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with my noble friends to put down an Amendment in this House to meet the point. This is the Amendment in question, and it has the same effect as the Amendment which the Opposition moved, and lost, on a Division in Committee in the House of Commons. It provides that where an increased rent is fixed on registration, in the case of a statutory tenancy, the increase may take effect not earlier than the date of registration or not earlier than four weeks before the service of notice of increase, whichever date is later. It is a bit of a "teaser", but the Amendment in fact carries out the pledge which was given in the Commons, and therefore, meets the views of the Opposition on this point. In that way they are more successful here than they were below. I beg to move.
Amendment moved—
Page 6, line 36, leave out from ("than") to first ("the") in line 37 and insert the said new words.—(Lord Mitchison.)
LORD NEWTON: We are very much obliged to the noble Lord for this Amendment, which is entirely acceptable. Until it appeared on the Order Paper, we had thought that we might try to put down a similar Amendment ourselves, but we have been saved the necessity of doing that and also the necessity, no doubt, of having to be told by the noble Lord that our drafting did not achieve the purpose we hoped it would.
Clause 7, as amended, agreed to.
Clause 8 agreed to.
Clause 9 [Notices of increase]:
6.51 p.m.
On Question, Whether Clause 9 shall stand part of the Bill?
LORD HASTINGS: This, again, is rather complicated. It appears that, during a contractual period, a landlord can serve a notice of an increase in rent relating to the tenancy which is going to follow—in other words, a statutory tenancy; but if he does that then, by virtue of subsection (3), that contractual period will immediately come to an end and the statutory period will begin operating. It is a bit difficult to understand the objective behind this. Can the noble Lord explain exactly what this clause is meant to do, and why?
LORD MITCHISON: Yes. If I may say so, I quite understand the apparent difficulty of the matter, but I do not think it is a very serious one. First of all, the notice of increase must be in the prescribed form. Obviously, the notice will have to take effect at some time. It is the notice taking effect which, as I understand it, will turn the contractual tenancy into a statutory one. What is being considered is not a change of tenant at all, but the transition from a contractual period to a statutory period.
Then, subsection (3), which is a rather special case, states:
"Where a notice of increase is served during a contractual period of a regulated tenancy and the tenancy could, by a notice to quit served by the landlord at the same time, have been brought to an end before the date specified in the notice of increase, the notice of increase shall operate to convert the tenancy into a statutory tenancy as from that date"—
that is, the date specified in the notice of increase. I can only say to your Lordships that I really do not think there is any catch in this. There may be some general point about notices to quit, but I think this particular clause is a reasonable provision.
LORD HASTINGS: Does this really mean, then, that any notice to increase rent changes the form of tenancy? Because that is what the noble Lord said: that it does not mean you are changing the tenant, but if you increase your rent it is going to become a statutory period and not a contractual one. Yet Clause 1(4)(b) says quite clearly that a statutory tenancy arises on the termination of such a tenancy as is mentioned in paragraph (a)—which, in other words, is the sitting tenancy.
LORD MITCHISON: This is really, as I understand it, applying to a regulated tenancy what is the ordinary practice with regard to controlled tenancies. Suppose a man is paying a given rent and (assuming you are entitled to do it) you serve him notice to increase the rent. That, in effect, is terminating the existing tenancy and starting a new one. It is a little bit of a lawyer's notion, but that is it. Where this is done by virtue of a Statute, you will get as the result what is commonly called a statutory tenancy within the meaning of "statutory tenancy" on page 30—that is to say, that at the end of Clause 44(1), which I have

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already mentioned. It is a regulated tenancy.
Clause 9 agreed to.
Clause 10 [Statutory tenancies of formerly requisitioned houses]:
6.56 p.m.
On Question, Whether Clause 10 shall stand part of the Bill?
LORD HASTINGS: This deals with the question of formerly requisitioned houses and their transition to regulated tenancies. The Protection from Eviction Act protected them beyond the period previously laid down, and eventually they will be treated as regulated tenancies. The landlord will then be entitled to receive from his sitting tenant the amount which he previously received from the sitting tenant plus the local authority. What I am not quite clear about—I think it relates to subsection (2)—is as to how he would stand in respect of any improvements carried out in the intervening period, when it was known that these tenancies were going to come out of statutory control, the old control, and into the regulated tenancy, and when it would be in the interests, perhaps, of the tenants and the landlords to make improvements in anticipation. I am wondering if there is any provision there for such an arrangement, by agreement or otherwise, where improvements can be carried out and the rent recovered.
LORD MITCHISON: I do not think that this clause specifically refers to improvements or any other particular point. What it does, as I understand it, is to continue a statutory tenancy—that is, the statutory tenancy of a requisitioned house under the appropriate Act—and prevent it from lapsing, as it otherwise would. This is subsection (1). Subsection (2) is really an amending subsection to apply to a particular group of tenancies references to the last contractual period; and if one looks at Clauses 5 and 6, one finds references to "the last contractual period". All that this says is that, having those references, you must in this case read them as though they were references to the "last rental period beginning before that date". Then there is a provision as to the rent recoverable, which I think does not affect the amount; it affects the channels through which it goes. Then there is another ancillary provision in subsection (3).
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I think this is really, in substance, a clause to continue tenancies of requisitioned houses which would otherwise lapse, unless expressly continued, and to provide, in subsection (2), what is really a drafting adaptation—it is a little more than that—for the cases covered by Clauses 5 and 6. I cannot say any more than that. I say quite frankly and "off the cuff" to your Lordships that I do not think there is a catch anywhere. If there is, I shall take care to let the noble Lord know.
Clause 10 agreed to.
Clause 11:
Power to convert existing controlled tenancies into regulated tenancies
11.—
(3) The Minister may by order provide as respects any area in England and Wales or in Scotland that where the rateable value on a date specified in the order of a dwelling-house in that area exceeded such amount as may be so specified and the dwelling-house is subject to an existing controlled tenancy the existing controlled tenancy shall be treated as a regulated tenancy.
(6) A notice of increase served under section 7 of this Act in respect of an existing controlled tenancy which by virtue of an order under this section is treated as a regulated tenancy shall only be valid if the rent specified in it does not exceed by more than fifteen per cent. of the controlled rent payable for the rental period beginning twelve months before the notice takes effect, except so far as the increase relates to such part of the rent registered under this Act as may in pursuance of the order be distinguished in the register as attributable to the provision of additional or improved services or furniture or the carrying out of an improvement; and in ascertaining for the purposes of this subsection the amount of the rent payable for any rental period, any amount payable in respect of rates borne by the landlord or a superior landlord shall be disregarded.
7.0 p.m.
LORD HASTINGS LORD HASTINGS moved, in subsection (3), after "dwelling-house," where that word first occurs, to insert "as is mentioned in the preceding subsection". The noble Lord said: I am not entirely sure whether there is substance in my Amendment or whether it is a matter of drafting. I want to be certain that the Minister has the power to do what I believe he intends to do, and, if he has not, I want to be certain that he has the power to do what I want him to do. My Amendment would make

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it quite clear that the Minister could make an order to convert an existing controlled tenancy into a regulated tenancy without at the same time affecting other regulated tenancies which are more strongly controlled at the moment. My fear on reading this subsection is that in order to convert an existing controlled tenancy into a regulated tenancy it will be necessary for the Minister to lower the rateable value limits to such an extent that all regulated tenancies would be affected. I want to be sure that he can start converting the existing controlled tenancies into regulated tenancies before he has finished taking the regulated tenancies out of regulation.
I am not quite sure, because of the way in which it is phrased, whether that is the intention or the legal interpretation or not. My Amendment will make it quite clear that this subsection, and the Minister's powers thereto, relate solely to the conversion of existing controlled tenancies, irrespective of what may be happening to regulated tenancies in a higher rateable value limit. I hope I have made myself clear. Of course, Amendment No. 13 goes with this one. I beg to move.
Amendment moved—
Page 7, line 41, after ("dwelling-house") insert ("as is mentioned in the preceding subsection").—(Lord Hastings.)
LORD CHAMPION: It is clear that we should also discuss Amendment No. 13 with this one. When we first saw this Amendment on the Marshalled List we were at a loss to know what it could possibly mean. I am sure the noble Lord will understand that I am not being disparaging. There is a difficulty here because the drafting seems to be faulty. Were the Amendments accepted, Clause 11(3) would read as follows:
"The Minister may by order provide as respects any area in England and Wales or in Scotland that where the rateable value on a date specified in the order of a dwelling-house as is mentioned in the preceding subsection in that area exceeded such amount as may be so specified the existing controlled tenancy shall be treated as a regulated tenancy."
In the preceding subsection, namely, subsection (2), there is no reference to a "dwelling-house". Here, clearly, the drafting was faulty. The preceding subsection defines the expression "existing controlled tenancy". I am sure, now
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that this has been pointed out to the noble Lord, that it will be clear that it was impossible for us, from the Amendment put down, really to see what the noble Lord was driving at.
But so far as the clause itself is concerned, generally, as it says, it is a clause which merely gives the power to convert an existing controlled tenancy into a regulated tenancy. The whole of Clause 11 is devoted to that sole purpose. If the noble Lord feels that there is something more in this point perhaps he will take another look at it. I must leave it to him to so decide. The Amendment as it appears is clearly unacceptable to the Committee and to the Government.
LORD MITCHISON: May I add a word? I am not sure, but I think that what was troubling the noble Lord was the fear that if this clause were operated and if existing controlled tenancies were to be turned into regulated tenancies it might, in some way, have to be accomplished by a general measure of decontrol.
LORD HASTINGS: Yes, that was my fear.
LORD MITCHISON: I rather thought that was the point the noble Lord was making. There is no connection between the two at all. Clause 11 does not require the Minister, in order to convert an existing controlled tenancy into a regulated tenancy, to control or to decontrol anything. The clause simply concerns conversion, and the two things are quite separate. I took the opportunity of verifying this point. There is no doubt about it.
LORD HASTINGS: I am glad to have had that explanation. I now realise the error in my drafting, because "dwelling-house" is not mentioned in the preceding subsection. I was referring to the definition of "dwelling-house" as it exists in controlled tenancies. But my worry here, as the noble Lord, Lord Mitchison has said, was that this could not be carried out without affecting the regulated tenancies. I wanted to make sure that the Minister did not delay all the action under Clause 11 simply because regulated tenancies were of a higher rateable value and could not be decontrolled at the moment. Evidently the Parliamentary and legal drafting is accurate; but in my own layman's view,

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it seemed to be faulty. I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
LORD CHAMPION LORD CHAMPION moved to add to subsection (3):
"except in the case mentioned in subsection (7) of this section".
The noble Lord said: This is simply a paving Amendment to the Government Amendment No. 16, and I am sure the Committee would like to discuss them together. The Rent Acts 1920 to 1939 have always applied to tenancies of premises used for both business and residential purposes (often called in this context "mixed premises"), provided the premises are within the relevant rateable value limits. Part II of the Landlord and Tenant Act, 1954, provides a code of protection for tenancies of premises occupied by the tenant for the purposes of business carried on by him or for those and other purposes including residential purposes. In order to avoid overlap between the two codes of protection it is provided in the Act of 1954 that Part II shall not apply to a tenancy which is controlled under the Rent Acts.
Many tenancies of "mixed premises" were decontrolled as a result of the reduction in the rateable value limits for rent control by the Rent Act 1957. Of these tenancies, many had become statutory tenancies under the Rent Acts and a statutory tenancy, not being a tenancy in the true sense of the word but simply a personal right of occupation given by the Rent Act of 1920, is not a "tenancy" for the purposes of Part II of the Act of 1954. In order to ensure that statutory tenancies of "mixed premises", upon being decontrolled under the Rent Acts, should obtain the benefit of the protection of Part II of the Act of 1954, the transitional provisions on decontrol in the Rent Act 1957 deemed such statutory tenancies to be tenancies to which Part II of the Act of 1954 applied.
It has been decided not to bring into rent regulation tenancies of "mixed premises", but to leave them with their protection under Part II of the Landlord and Tenant Act, 1954. It follows that wherever the Bill provides that existing controlled tenancies may become regulated tenancies and statutory tenancies of "mixed premises" may be affected,
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it is necessary to have a provision deeming these statutory tenancies to be tenancies to which Part II of the Act of 1954 applies, so that they may pass into the code of protection provided by that Act and not into rent regulation. This has been done in Clause 13(5) in the case where on a second transmission on death, a statutory tenancy becomes a regulated tenancy, and the present Amendment enables an order made under Clause 11 to convert existing controlled tenancies into regulated tenancies also to provide that statutory tenancies of "mixed premises" affected by the order shall become protected under Part II of the Act of 1954 instead of becoming regulated tenancies.
Why have I read out that lot? I can only tell your Lordships that it is just to ensure that if any of you are deeply interested in this subject and have lawyers' minds, you can between now and Report stage consider it very carefully; and if you feel justified, you will put down Amendments for that stage. I beg to move.
Amendment moved—
Page 7, line 45, at end insert the said words. —(Lord Champion.)
LORD NEWTON: When I first read and then re-read Amendment No. 16 I could not understand what it did. Being a humble man, I thought it was probably due to some failing in my mental powers. Having heard the explanation of the noble Lord, Lord Champion, I now feel that possibly I am not quite so much to blame as I had at first thought. I should like to be able to compliment the noble Lord on having given us an explanation of the Amendment which was in fact substantially clear. I think I have grasped what it is all about, and, if I have, I think that what the Government want to do is acceptable. I am not a lawyer and I do not know how many lawyers are present in the Chamber at this time, but I would say to the noble Lord, in the friendliest possible way, that we are legislators and that, as such, mercifully, we are not required to have a legal training.
THE CHAIRMAN OF COMMITTEES: Before I call Amendment No. 15, may I inform the Committee that the noble

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Duke, the Duke of Atholl, wishes to move it in a slightly amended form, so that it would read:
"Page 8, line 15, after first ("rent") insert ("or by seven shillings and sixpence per week, whichever is the greater.")
7.14 p.m.
THE DUKE OF ATHOLL THE DUKE OF ATHOLL moved, in subsection (6), after "controlled rent", to insert:
"or by seven shillings and sixpence per week, whichever is the greater,".
The noble Duke said: I must apologise to your Lordships for having put this Amendment down wrongly. I am sure that any noble Lord who has studied the Bill would have realised that I meant 7s. 6d. per week, but the Amendment does not say so and until this point the reference has been only to percentages, so that there was no need to put in a time. The object of the Amendment is to make sure that rents which are to be raised to what is now to be called the regulated rent can be so raised by a reasonable amount. If I talk about Scotland rather than England, it is not because I do not realise that this Amendment will apply not only in Scotland but because, on the whole, the rents in Scotland are much lower than those in England. Whereas a 15 per cent. increase per annum in England might be a very reasonable amount, in Scotland in many cases, with the very low rents there, 15 per cent. would be under 1s. 6d. That does not seem to me to be an adequate amount by which rents should be increased.
Perhaps I may go briefly into the history of rent control in Scotland. It is somewhat different from what it has been in England and, from the point of view of the landlord, even less satisfactory. From the point of view of the tenant I think that although rents have been kept low, as a result of their extreme lowness improvements and repairs to houses have often been neglected. If you paid £20 rent for your house in 1914, you were protected. Any house in Scotland with a rent of under £30 was protected in 1914. Out of that £20 the owner would pay rates of £2 15s. That was the average amount; it varied from city to city and county to county. That left the landlord a net amount of £17 5s.
In 1920, under the Act of that year, these rents were raised by 40 per cent. including an allowance for owners' rates.
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This had the effect of raising the gross amount of a £20 house in 1914 to £29 10s. Out of this would have to come owner's rates of £6 5s. 6d., taking an average, as it also raised the amount of owner's rates, leaving the landlord with £23 4s. 8d. By 1939, owing to the increase in owner's rates, the amount the landlord actually received was £19 18s. 3d. In 1956 this had dropped still further to £15 12s. 3d. In 1957 owners' rates, as such, were abolished, and what had previously been the figure for owner's rates was deducted from the rent; and you were allowed to raise rents by 25 per cent. This had the effect of raising the figure for this type of house to £22 19s. 9d.—call it £23. So in the period between 1914 and 1964—because the figure has not altered since—the amount of increase in respect of this house which the landlord actually received, after deducting owner's rates, had risen from £17 5s. to £23. As a matter of interest, during the same period the joiners' jobbing rate went up from s. 0½d. to 11s. 8d. per hour. This makes clear how impossible it has been for landlords in Scotland to keep their controlled tenanted houses in good repair, unless of course they did it largely out of their own pockets. Incidentally, for the English equivalent to the £20 Scottish house in 1914 the rent now would be £67.
That was the average over the whole of Scotland. Sometimes, owing to the incidence of very high owners' rates, it would be even worse. At Armadale a £20-gross house in 1914 would have had a rent of £18 7s. 6d. and in 1964 its rent would be £13 2s. 7d. That shows quite an appreciable decrease since 1914. In Lanarkshire, the 1914 rent would have been £16 10s., and in 1964 it would have been £16 10s.—exactly the same. In the city of Glasgow, in 1914 it would have been £17 5s., and in 1964 £21 8s. 6d. A 15 per cent. increase on rents of this kind would produce about £3 a year, or rather less than 1s. 2d. per week. This seems to me an inadequate amount for the actual rent ever to catch up with the regulated rent, because, presumably, as things become more and more expensive regulated rents would be allowed to rise, and at an increase of 1s. 2d. a week it is going to take, even in present circumstances, a fairly long time for the actual rent to catch up with the regulated

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rent, even if the regulated rent remains constant.
Perhaps I can give your Lordships some actual examples of rents in Scotland. For a house in Dundee with three bedrooms, kitchen and w.c., the rent in 1914 was 3s. 2d. a week, after deducting owner's rates, and in 1964 it was 6s. 2d. The 15 per cent. increase, which would be allowed under this Bill as it stands, on that rent would amount to 7½d. per week and the landlord would be allowed to raise the rent by 7½d. per week every year. For a more modern house built in 1936, with three bedrooms, kitchen and bathroom, in 1936, after deducting owner's rates, the rent was £24 16s. 3d., and in 1964 £25 17s. 6d. The landlord would be allowed to increase the rent by s. 6d. per week. I can produce many other examples, but I feel that it would only bore your Lordships if I did so.
I would also point out that council house rents, which in Scotland are extremely low, have been allowed to increase much more substantially than private rents. I am not saying that such increases are wrong; in fact, I think they are absolutely right; but I think it unfair that landlords should not be allowed to increase their rents by an amount which the councils appear to regard as reasonable. The average weekly controlled rent of council houses in Scotland in 1956 was 5s. 9d., and in 1964 14s. 2d.—or an increase of about 150 per cent. in eight years. I think that the percentage rise allowed under the Bill is unfair, because it will act most slowly on the lowest rented houses and these are the houses in which the tenants have had the benefit of these low rents for the longest. Therefore, I hope that the Government will consider providing for some cash sum as well as this 15 per cent., so that only if the 15 per cent. came to more than the cash sum, which I have suggested should be 7s. 6d. per week, would the 15 per cent. apply.
I would also point out that controlled rents in Scotland are approximately 55 per cent. of the gross annual value. Obviously this is a very wide average and the figure varies from place to place and from one type of house to another. At the 15 per cent. increase it would take six years to reach the gross annual value,
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and that is presuming that in the quinquennial valuation the gross annual value was left constant, which seems to me an unlikely event. For decontrolled houses of the same type the rents are about 122 per cent. of the gross annual value. I hope that the Government will be able to hold out some promise on this question. I do not necessarily think that 7s. 6d. per week is the right amount. I suggested that amount to indicate the lines on which my thoughts were running. I beg to move.
Amendment moved—
Page 8, line 15, after first ("rent") insert the said words.—(The Duke of Atholl.)
BARONESS ELLIOT OF HARWOOD: I wonder if I could add a word in support of the noble Duke's Amendment. It is one of the curious anomalies between the two countries that rents in Scotland have always been much lower than those in England. In most cases, it is not because the houses are any worse, but I think that this has been one of the causes, certainly in the big cities—and I am thinking particularly of Glasgow, which I know so well—of the great increase in the amount of property which could have been kept in good repair but is becoming slum property. In Scotland, when a landlord puts property into good repair, which most landlords are anxious to do, he has to do it from his own pocket and he does not get a return, except the satisfaction that the person living in his house is living in a very good house—a charitable attitude if he can afford it, but not practical if he cannot afford it.
I agree with the noble Duke that it is impossible to say that 7s. 6d. a week is the right figure to put in the Bill. Recently the noble Lord, Lord Cohen of Brighton, in an admirable maiden speech, stressed the fact that rents were much lower in Scotland and that it was much more difficult there to keep property and also to build new houses from which one could get a good return. The noble Lord, Lord Hughes, who is well cognisant of these facts because of his long experience in local authority work, knows that what we are saying is true. I do not want to make any special pleading for Scotland, but I want to stress that with such a big discrepancy between Scotland and England there should be some recognition of this, so that something can be done to help landlords, who at the

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present moment find that it is impossible to keep their properties in repair unless they do so out of their own pockets.
7.28 p.m.
THE JOINT PARLIAMENTARY UNDER-SECRETARY OF STATE FOR SCOTLAND (LORD HUGHES): When this Amendment was put down by the noble Duke, my noble friends anticipated that he might be speaking largely in terms of Scottish rents, and for that reason I was delegated to reply to this Amendment. The noble Duke has made his points with such perfection that I find myself, as I did on another Bill recently, feeling that I am being grossly unfair when I come to say that I am sorry, but I cannot advise the Committee to accept this Amendment. When there is added to this the fact, which must appeal to all Scots, that the noble Duke's arithmetic is impeccable—he has got the answers to all his sums perfectly right—and there is added the final difficulty, that he has been joined by the noble Baroness, Lady Elliot of Harwood, I find myself in an almost indefensible position. Fortunately, I am able to put in the word "almost".
Although both (if I were to follow Lord Saltoun's advice, this is what I would call them) noble Lords have spoken on this from a Scottish point of view, they have recognised that this applies throughout the whole country. It is principally for that reason that the Government cannot accept the Amendment. The Amendment, while perhaps having some relevance if related solely to rents in Scotland, would have an unfortunately regressive effect in England and Wales, in that the figures of increase would apply most hardly on the occupants of the poorer classes of property. That figure, of course, would apply in either country, but it would apply South of the Border, as well as North of the Border. When we remember that in many cases these very much older and poorer, and therefore much more cheaply rented, houses in both countries are often occupied by old people with fixed incomes, an increase of 7s. 6d. a week, or anything approaching it (though I recognise that the noble Duke and the noble Lady did not tie themselves to this figure, but were seeking merely to get the Government to accept the principle) could be a significant increase in the weekly budget of people of that kind.
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For this reason, we do not think that there is ground for discriminating against such people by providing that what they shall pay is, in percentage terms, a much larger increase than the occupants of better quality houses are paying. By and large, the rent of these poor houses at low levels remains low because it is, in comparison with the others, a fair enough figure for the quality of the housing provided. That is where I am comparing a poor house in one country with a better house in the same country. I know that the argument falls to the ground when you compare rents in England with rents in Scotland, because a comparatively poor house in England and Wales may be being rented at a figure which approximates to a rent being charged in Scotland for a house of much better quality.
I agree with the noble Lady when she says that she does not think there is all that difference between a reasonably good house in Scotland and a reasonably good house in England and Wales. But when we get to the other end, I think perhaps the noble Lady would agree with me when I say that what we have occupied in Scotland as poor houses, houses of poor or low quality, generally tend to be much worse than anything found South of the Border. There can be exceptions to this, I know; but I am talking in general terms.
Even in Scotland, accepting the correctness of the noble Duke's sums, the Government still cannot accept this position related to almost any figure which would serve the noble Duke's purpose over the whole range. It could, in fact, have the effect in the case of those least able to bear the burden of the figure of 7s. 6d., of doubling, or in some cases of very poor houses trebling, the rent which is paid. That, in the Government's view, could have an effect on the domestic budgets of people less able to bear it which the Government would not be justified in imposing when there had been no alteration in the tenancy and when there was no alteration in the quality or condition of the house.
Perhaps I may put one other point, which I think is in the Government's favour, in this matter. Accepting all the arguments that are advanced about the

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slowness by which, with 15 per cent. increases, we should proceed from a controlled rent to a fair rent, I would remind the noble Duke that when he was quoting his figures he got to the last increase of 25 per cent. which was permitted, and then said, "and that remains the position, because there has been no increase since then.". That increase of 25 per cent. went on for a period of some six or seven years. What the Government are doing in this Bill would permit, during a period of that time, an increase in rents four times as great as the previous Government thought it politic to make. That, I would suggest to your Lordships, is a considerably different approach from the one which has been taken; and it recognises, to a certain extent, that to arrive at a fair rent we must proceed by bigger steps than have been contemplated up to the period of 1956, 1957 or 1958.
To substitute for a percentage, which by and large is fair to all people, an alternative figure of a certain sum of money would be quite reasonable in regard to the better-type houses and to the tenant with a better kind of income, but it would be grossly unfair to those in poorer houses and with lower incomes. It is for these reasons, both in Scotland and South of the Border, that the Government cannot advise your Lordships to accept this Amendment.
BARONESS ELLIOT OF HARWOOD: May I ask one question before the noble Lord sits down? I am not suggesting that the rents of very poor houses should be raised, unless the landlord is prepared to put them into better condition. The real difficulty here is that, where one knows there are poor houses and people. old-age pensioners, on a fixed income, say, one wants to help them, but it is not possible; and they will have to continue to their dying day in these houses unless some help is given to the landlord, or to the tenant when the houses have been improved.
That is what has led to these terrible slum dwellings in a great many cities in Scotland. It is impossible for landlords to spend money on a property to put it in the condition which the noble Lord opposite, and we on this side, feel it should be for people to live in. Unless there is some breakthrough on this matter,
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we shall not get exactly what the noble Lord wants and what we all want: that houses should be improved, but still let at reasonable rents—and I do not suggest anything else. Unless there is some method of difference between what exists North of the Border and South of the Border, I doubt whether this can be done.
LORD WOLVERTON: I should like to support the noble Duke in this Amendment. I cannot see why there should be such a big difference between North and South of the Border. Take the painting of a cottage. To-day it costs something like £40 to have a cottage painted outside by a contractor, and that would probably cover two years' rent. As this Bill is dealing with a fair rent, and we are setting up these rent officers, it seems to me, from what the noble Duke has said—and the noble Lord, Lord Hughes, has confirmed that the figures are correct—that there is far too big a difference between North and South of the Border. If the houses are kept up in a decent state, and can be improved, a 15 per cent. increase does not seem to be anything like enough. If they cannot afford the extra rent out of their old-age pensions, they can always get a supplementary allowance from the National Assistance Board, who take rent into consideration. i know that many of them do not like going to the National Assistance Board; but they can do so, and many of them do. It seems to me wrong to keep North of the Border at such a disadvantage to South of the Border in regard to properties which we all want to see kept up in a decent state and let at low rents (in many cases they are not occupied by old-age pensioners, but by people who earn good wages), and I think that something on the lines suggested by the noble Duke ought to be done.
LORD HUGHES: If I could answer these two points, I would remind your Lordships that we have had rent control since 1920—that is, for 45 years. During that period there has not at any time been any attempt by Parliament to set up a different standard or form of rent control for Scotland from that for the rest of the country.
THE DUKE OF ATHOLL: Surely rent control in Scotland was much more severe during the years between 1914 and 1939 than it was in England. I

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thought that was when this big differential started in the level of rents between the two countries.
LORD HUGHES: The effects were intensified, as we all know, and as the noble Duke has said, because of the effects of the rents system which have complicated the position South of the Border. But under these proposed increases of 15 per cent. each year we shall reach in a comparatively short time (when one compares that with the 45 years which has elapsed since rent control was first imposed by Parliament) a position where fair rents in Scotland will be the same as fair rents in England, as reflected by what the assessors decide are gross annual values. That, I think, is a tremendous improvement from the landlords' point of view on what has taken place up to the present time.
The noble Duke said that he did not wish to bore the House with more figures, and I did not want to complicate the situation by bringing in my own set. But I think it would meet this point if I said that the figures which have been given on the rents being charged would enable gross annual value to be reached in from three to five and a half years. If the gross annual value is increased in a year or two, you have to add something to that to reach that new figure. But it means that within a comparatively short period the enormous differences between the controlled or fair rents in Scotland and the controlled or fair rents in England will disappear.
THE DUKE OF ATHOLL: But if the noble Lord, Lord Hughes, does not dispute my figure that the average rent of the rent-controlled house in Scotland is 55 per cent. of the gross annual value, it means, since 15 per cent. of that 55 per cent., if my mathematics are right, conies to about 8 per cent. of the gross value, that to catch up the remaining 45 per cent. is going to take six years. We have a quinquennial valuation every five years. The likelihood seems to be that in the next quinquennial valuation—again this is a global figure—the gross annual values will go up 30 per cent., and if we go on as we are now we shall be no nearer reaching the gross annual value at the end of five years than we are now.
I should like to support what my noble friend Lord Wolverton said about the old-age pensioners. Of course, we all
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realise that there are cases of hardship, but I should have thought that the National Assistance Board was designed to cover exactly this point. I really cannot see that that is a great consideration. As for the other tenants, if they have been sufficiently lucky to live in those lowly rented houses for so many years—I do not say I think they will be delighted to pay a bigger rent, but they ought to be prepared to pay a rent which is rather more commensurate with what it costs the landlord to keep these houses in reasonable repair. After all, they are protected at the top by the fact that the landlord cannot go over the fair rent to be decided by these committees. I cannot see at all that the noble Lord's arguments are very good, but perhaps before I do anything further he might say how he arrives at this period of from three to five and half years within which the rents will go up to a figure equal to the gross annual value, because I think this is a basic point. How long is it going to take to get rents anywhere near the gross annual value?
LORD HUGHES: I did not have to do what the noble Duke has done, and work out the sums for myself. I had them worked out for me within the Scottish Office. For instance, if we take the group with the gross annual value of less than £15, the amount of annual increase would bring that rent from its present controlled rent to a gross annual value in three years. When we reach the £21 to £25 gross annual value group, it would take four and half years to reach the gross annual value; and in the £41 and over group it would take five and half years to reach the gross annual value.
I have already accepted the noble Duke's point, that before that period has elapsed a new gross annual value will have been fixed, which presumably will be greater than the present one; and that five years after that there will be yet another one, which may well be higher than the one which is yet to be fixed at the next quinquennial review. What I am quite certain about is that the gross annual value is not going to be increased by something which approximates to 75 per cent. every five years, which is the figure by which it would have to be increased in order to stop the 15 per cent. per annum catching up on it. So it will merely defer the catching up of the fair

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rent by a little longer, and instead of being achieved in from three to five and a half years it may take from five to eight years, or something of that order. But certainly before the second quinquennial review is reached, the 15 per cent. increases are bound to take the figures up to the gross annual value; and if the fair rent is calculated as being something higher than the gross annual value, the 15 per cent. would continue to be added.
7.48 p.m.
LORD NEWTON: As my noble friend Lord Wolverton was brave enough to intervene in a debate which otherwise was entirely dominated by those who live North of the Border, perhaps I may be equally brave for a moment or two. I am bound to say that I thought my noble friend the Duke of Atholl, and my noble friend who supported him, made out a most convincing case for including some weekly figure as an alternative to the percentage. My noble friend said that he was not particularly wedded to 7s. 6d., and I do not suppose anybody is. I was astonished to hear my noble friend's account of how minute the increase may be to the rents of houses in Scotland if the annual increment is on the basis of 15 per cent. I should have thought that any cases of hardship would be properly taken care of by the National Assistance Board which, as he said, exists precisely for that purpose, among others.
It seemed to me, listening to the general argument of the noble Lord, Lord Hughes, that one was bound to deduce from it that in his view those who cannot afford to pay an increase of 7s. 6d. per week will probably never be able to afford the fair rent when rents come to be registered. What this clause does is to provide for the transition of controlled rents to regulated rents. If he is maintaining that a figure of around 7s. 6d. per week is much too large for people to be able to afford, is it likely that they will ever be able to afford the regulated rent when it has been fixed by the rent officer or the rent assessment committee, unless he is going to assume that the registered rent is not going to be a fair rent (as we have been given to understand that rents will be)—in other words,
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is to remain artificially low. Perhaps we may be told about that.
The noble Lord also took the point that he dislikes the fact that this Amendment applies to the whole of England and Wales and Scotland. I was not quite sure why he was objecting to that fact. I do not know what my noble friend the Duke of Atholl feels about this, but no doubt he would be willing to consider, at a later stage, putting down an Amendment which deals either specifically with Scotland or with England and Wales. It does not seem to me to be a point that we could not get over.
LORD HUGHES: The noble Lord has invited me to say whether I felt that people would ever be able to pay a rent increase of 7s. 6d. a week, if my arguments were valid. I do not say that is the position; but what I do recognise, and I am quite certain that at least some noble Lords opposite will also recognise, is that what is an impossible burden for anyone on a comparatively small income to bear when it is suddenly thrust upon them, as an increase to be faced as from next week or next month, becomes one to which they can be accustomed if it is taken in bites. Seven and sixpence per week might be virtually impossible and might cause people to take action to avoid it by trying to get into an even worse house—an action which they would not feel impelled to take if they were asked to reach the 7s. 6d. by stages of 1s. 6d. or 2s. or 2s. 6d. per week. At the end of the day they are absorbing the same total figure, but it has been possible to adjust their circumstances to it over a period.
I readily admit that in the case of those who are in a position to receive National Assistance—and old-age pensioners form an obvious class—there need be no particular hardship to them, because probably they could get the whole amount of the increase refunded by the Assistance Board. But unfortunately that fact has not got over, particularly in Scotland, to old-age pensioners as a class. In far too many cases they still regard the Assistance Board as being the parish council and National Assistance as a form of Poor Law relief which they consider they ought not to take. We all know that is quite wrong, but it is a fact of life with which we have to deal. In the result, although

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the noble Duke referred to increases of rent which have taken place at a very much greater level with local authorities, it is possible to look at almost every case and find that old-age pensioners have been excepted from the severity of the increase. In fact, of course, the people concerned have not derived any benefit from that: it is the Government who have benefited because they have not had to pay it out in assistance, but the local authorities have recognised that in far too high a percentage of cases the people were not going to the Assistance Board and that the extra rents would have come out of the money they had available for food.
I think it would be quite wrong if I were to create the impression that I was asking you to believe that everyone in low-rented houses was far less likely to be of the low income group than the old-age pensioners. That is not the case. But it is the Government's view, which I think cannot be disputed, that in advancing rents by 15 per cent. per annum we are going much faster towards a fair rent than anything that has been attempted by a previous Government.
LORD NEWTON: Obviously this is a matter we could go on discussing all night, but I do not want to prolong the discussion unduly. I do not know whether it is for me to offer any advice to my noble friend, but. I think he would be perfectly justified in saying that he will not pursue this matter any further this evening and will withdraw his Amendment but that he might well take the matter up at a later stage.
THE DUKE OF ATHOLL: I think there is another good reason why I should not pursue it further this evening, and that is that I drafted it badly and I should like noble Lords to know what they are dividing on. I would ask the noble Lord, Lord Hughes, whether he would be happier if I were to put some percentage limit at the top of the increase—say 40 per cent.—so that if the increase was over 7s. 6d., 15 per cent. would apply, but if it was under 7s. 6d. there would be a maximum of 7s. 6d., or 40 per cent., increase. I think I have expressed this badly and I should need to think of words in order to put it in the Bill. But it seems to me there is a good case here for allowing house rents in Scotland to rise
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by more than 15 per cent. and I do not accept Lord Hughes's figures that they would reach the gross annual value in between three-and-a-half and five years. In many cases I think it would take six years to reach even the present gross annual values. But, having warned the noble Lord that I propose to deal with this matter on the Report stage, I should now like your Lordships' leave to withdraw this Amendment.
Amendment, by leave, withdrawn.
LORD CHAMPION: I beg to move.
Amendment moved—
Page 8, line 28, at end insert—
("() The provision to be made by an order under this section with respect to an existing controlled tenancy which is one to which Part II of the Landlord and Tenant Act 1954 would have applied but for paragraph (c) of section 43(1) of that Act (or would have so applied had it been a tenancy within the meaning of that Act) shall be that the existing controlled tenancy shall be treated for the purposes of that Act as a tenancy continuing by virtue of section 24 thereof after the expiry of a term of years certain.")—(Lord Champion.)
On Question, Whether Clause 11 shall stand part of the Bill?
THE EARL OF KINNOULL: I wonder whether I might raise one point at this stage. While I am sure everyone welcomes the power that this clause gives to the Minister to convert controlled tenancies into regulated tenancies, many people, including the professional bodies, feel that some time limit should be put into this clause so that the Minister has, say, three years to put it into effect. Many people feel that the rents under controlled tenancies are already eight years behind the principle of fair rent as it is described in this Bill, and every year this gap widens. No hardship at all will be caused by putting in a time limit in this clause because, as has been said, there is a cushioning effect on the amount of increase which will be put on in any one year.
The only argument I can see that the Government may use against the proposal of a time limit is that the Minister will be unable to organise the machinery that he has to set up under this Bill in the time available, and the question of his priorities. My answer to this would simply be that the Minister should have

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a time limit. It would get him on his toes, and I suggest that a practical time limit would be three years. I hope the Government will give sympathetic consideration to this suggestion.
LORD MITCHISON: I think I caught the noble Lord's point correctly. What he is asking for is some time limit to be put into this clause at some stage. I do not think one can do that. It has been made perfectly clear in another place and, I hope, here that we are going to get on with this as fast as we can. After all, is it likely that we are going to do anything else? This is one of our major measures and we believe it meets, to some extent at any rate, a really urgent need which ought to have been met long ago.
We are not going to delay in the matter at all. In giving the noble Earl and noble Lords generally that assurance, I am merely repeating what my right honourable friend the Minister has said in another place more than once. But when it comes to setting a timetable I think that is more difficult. Moreover, this is one of the things in the timetable which would not necessarily come first. The first thing we shall want will be to get out of what I may call the "frozen period" into the regulating period. That is our first job. We shall need the machinery set up first. This should take a little time. If I may say so, I think it would be a mistake to try to put an exact time on what is necessarily a subsequent part of the chain of events which we hope to produce under this Bill.
LORD HASTINGS: I quite agree with what the noble Lord, Lord Mitchison, said. I think it is virtually impossible to put in a time limit. On the other hand, I think my noble friend Lord Kinnoull brought up a most important point. We do want to be quite certain that it is the intention of the Government not merely to regulate all those tenancies at the moment outside control but also to bring into regulation the existing controlled tenancies. We are anxious to know that it is the Government's firm intention to push ahead as fast as possible so that they will get around to bringing the existing controlled tenancies into regulation and not dilly-dally on the way and merely concern themselves chiefly
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or solely with the regulation of tenancies which are at the moment not controlled.
LORD MITCHISON: First things first. We believe that the best solution we can see of the landlord and tenant problem in connection with these groups of houses is regulated tenancies. But I do not think that the noble Lord can expect me to give him an undertaking that either at any time or generally we shall necessarily decontrol everything—
LORD HASTINGS: I did not say "decontrol".
LORD MITCHISON: Regulate—convert from control into regulation everything. All I can say is that I cannot for myself (and I am sure I am speaking for the Minister, too) see a final solution in changes in the arithmetical form of control that controlled tenancies represent. We look for a solution in regulated tenancies, and therefore the more we can convert to them the better we shall be pleased. I think that is the best way to leave it at the moment and the fairest to all concerned.
Clause 11 agreed to.
House resumed.

SEVERN BRIDGE TOLLS BILL
8.4 p.m.
Order of the Day for the Second Reading read.
LORD BESWICK: My Lords, the main purpose of this Bill, to which I shall invite your Lordships to give a Second Reading, is to empower the Minister of Transport to levy tolls on vehicles using that part of the M.4 motorway carried by the new bridges over the Rivers Severn and Wye. I am glad to say that there was some controversy in another place about this decision to make users pay for this fine new project by way of tolls. I am glad because I think it would have been wrong to have taken completely for granted that this was the best and most economical way of raising money for such a public work. It seems to me clear—and we always argue this—that every person employed to collect money in this way, and every piece of equipment he uses, is an additional cost to the economy. Nevertheless, we have to face

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the fact that if money is to be found it is more palatable, in present circumstances at any rate, to pay a contribution at the time when the corresponding benefits and savings are immediately to be seen.
The saving to the user of the Severn Bridge will be obvious and substantial. It is estimated that at least 45 miles will be saved on a journey between Bristol and Cardiff, which for a medium-sized car should mean something like a saving of 8s. or 9s. in petrol alone apart from other running costs, and of course probably even more valuable time. I ought to add that this principle, or expedient, I may say, of levying such tolls when the capital costs of the project are exceptionally high and when the savings to the user are especially great already applies to major river crossings over the Tamar and the Forth and under the Thames, by way of the Dartford Tunnel, and powers exist to do the same for the Tay Bridge and the Tyne Tunnel when they are completed. I probably ought to stress the distinction drawn between these initially expensive but cost-saving crossings and other classes of road improvements. There is no intention to extend tolls to motorways or new trunk roads.
So far as the initial capital cost of this particular project is concerned, it is interesting to note that whilst the cost of a motorway is something of the order of three-quarters of a million pounds a mile, the cost for the 2¾ miles between Aust in Gloucestershire and Newhouse in Monmouthshire, which includes the Severn Bridge itself, a bridge over the River Wye, a viaduct across the Beachley Peninsula linking the two bridges, and short lengths of motorway leading to the access points at each end, is given at some £13 million.
Clause 2 of the Bill enables the Minister to make orders setting out the scale of tolls to be charged, and Clause 3 prescribes the procedure for making these orders, including consideration of objections and, in certain circumstances, the holding of a local inquiry. I do not think it would be for the general convenience of the House if I went through the Bill clause by clause, but I should like to refer to important changes made during the passage of the Bill, which is of course
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a hybrid, through its various stages, including the Select Committee.
Clauses 10 and 11 enable the Minister to extinguish ancient franchises to operate a ferry across the River Severn at the point where the bridge is being built, and if the Minister is satisfied on certain points a payment of £90,000 compensation is to be paid to the operators. This is an agreed settlement and is by way of a package deal covering a number of related points.
Then there is the limitation now proposed to be set to the power to levy these tolls. During its passage through another place it was strongly urged that the original provision would permit this toll to become in effect a perpetual tax, that there was no time limit upon its imposition and no ceiling upon the total sum to be raised. To meet these fears Clause 4 and Schedule 2 were introduced during the Committee stage. The new clause provides that the power to levy tolls will end after 40 years from the opening of the road, and the Schedule specifies the purposes for which those tolls shall be levied. If the total sum raised within the 40 years is held not to meet the cost of the specified purposes then there is power to extend the toll period if Parliament approves the required order.
The Bill, as amended, was generally acceptable to all Parties in another place, and the great engineering achievement to which it refers will certainly be welcomed, especially by the people in the South-West, and is, I think we all agree, a major step forward towards modernising our country. I therefore commend the Bill to your Lordships and move that it be read a second time.
Moved, That the Bill be now read 2a. —(Lord Beswick.)
8.10 p.m.
LORD ST. OSWALD: My Lords, we can give a sensible and sincere welcome to this Bill. As a Yorkshireman commuting between Westminster and the West Riding, I may never have cause to use the future bridge that we are debating. But I can feel happy with the noble Lord for those to whom it will be undoubtedly a great boon. It has been said by the Minister that it will save something like 45 miles in each direction for those travelling between Cardiff and Bristol, and save them between 8s. and

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9s. in petrol. Of course it goes beyond that, when the removal of human frustration is counted in, and it may well be that doctors in the West Country will have fewer ulcers to treat after the bridge is in use.
Our view on these Benches regarding a bridge, or for that matter a tunnel, providing an outstanding and demonstrable advantage for a particular type of traveller, is that the principle of charging a toll is quite acceptable. This principle was given the stamp of approval by the Conservative Minister of Transport in 1955. It has taken rather longer for the Party now in power to come round to that view, but we can feel pleased that they have done so in time for this valuable measure.
Without any doubt—again I think the Minister has said this—the Bill was greatly improved during its passage through another place by the present Clause 1, which achieved an important safeguard called for by the Opposition. It is now provided that the power to levy tolls upon travellers over this bridge will end, under conditions as foreseen, after 40 years. There is also an escape hatch through this time-ceiling in case sufficient money has not been raised by that time, to meet the large initial outlay of taxpayers' money. The Minister may extend the period by a period of five years, and even in five-year terms beyond then. But in order to do so he will have to come to Parliament, to persuade it that this extension is necessary. If, on the other hand, which is conceivable, the money is raised in less than the 40 years, I think I am right in saying that the Bill allows for the cessation of tolls.
In the sunny climate of this debate I am going to raise only one point of difference across the Floor. Clause 8 enables certain vehicles to be banned from using the bridge. In essence, this makes sense, because it can be plainly seen that the prevention may be for the driver's own safety as well as that of other road users. Examples come to mind of the tall, empty lorry attempting to cross the bridge over the estuary in a high wind. This type of vehicle in those particular conditions could easily present a danger both to the driver and to others. But it seems to my colleagues and myself that the terms under which
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this power to prohibit is given are altogether too loose.
I will quote the words I mean, beginning at line 12 on page 9:
"to prohibit, or to empower any person authorised in that behalf in pursuance of the regulations to prohibit, the use of the specified carriageways by any particular vehicle or by vehicles of any particular class or description, either generally, or in particular circumstances, or unless particular requirements imposed by or under the regulations are complied with."
These words, or some of them, it seems to me give remarkable power to the individual, be he a policeman or other authorised person; and power without guidance. I would ask the Minister, who is always so extremely conscientious and willing to help on these occasions, to look most carefully at this, and to see if a form of words could not be introduced, preferably by the Government, to take care of this anxiety and this possible invasion in certain cases of the liberty of the individual.
The Minister may well say, as did his honourable friend in another place, that the Government have in mind the exceptional circumstances and the need for someone with the judgment and the power to back that judgment in exceptional circumstances. But I feel that the road-using public, or in this case the bridge-crossing public, would have their minds set at rest if clearer guidance could be given to the person so employed and vested with this authority: guidance which would enable him to convince the diverted driver—because the driver would have then a far longer route to take—that there was a clear statutory reason for his being so diverted.
The words, the "blanket" definition, which I find unconvincing, are "any particular vehicle" in lines 14 and 15. Any vehicle, if it be a Mini or a pantechnicon, can be described as a "particular vehicle", and the words seem to me to lay the prohibition open to potential unfairness and consequent resentment, which I know that the noble Lord would not wish to see caused as a result of any measure passing through his hands. My Lords, with this small proviso, I should like to congratulate the Minister on bringing in the Bill, and I join him in hoping that it receives a Second Reading.
8.16 p.m.
LORD BESWICK: My Lords, if I may be permitted to reply just to the one point which the noble Lord has mentioned, I will do my best. First, may I thank him for the way in which he welcomed the Bill. Without necessarily agreeing with him as to who was most responsible for improving the Bill during its passage through another place, I think we both agree that the Bill has been improved.
On the matter of the provision in Clause 8 to which he referred, I take his point. There is, however, a difficulty in getting a form of words which would define not only the type of vehicle but the particular vehicle which it may well be necessary to turn back. There is such a wide range of variations to consider. The weather over this new bridge has not been measured as yet. It is quite an exposed bridge and there will be a wide variety of weather conditions. The loads of the vehicles might well vary. It might be quite safe for a particular vehicle to make a crossing on a particular day, but the next day the same vehicle, with a different load, in different weather conditions, might well constitute a risk; and a person with experience—a constable or the toll operator, or some other approved person in charge, somebody with more experience than the driver of the vehicle—may well be in a position to offer advice or give instructions which would be acceptable in most cases, I should have thought, by the driver.
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However, one sees that it would be advisable to have these conditions as closely defined as possible, and I assure the noble Lord that when the Minister comes to draft his Regulations, he will bear in mind the sort of considerations which the noble Lord has put forward. With that, I hope it will be possible for him to accept the Second Reading.
On Question, Bill read 2a.