HOUSING BILL

HL Deb 16 July 1969 vol 304 cc370-421

8.0 p.m.

House again in Committee.

Schedule 3, as amended, agreed to.

Clause 53 [Modification of Rent Act 1968 in relation to improvements assisted under Part I of this Act]:

On Question, Whether Clause 53 shall stand part of the Bill?

Lord BROOKE of CUMNOR

I have put down an Amendment to leave out Clause 53. For all I know, there may be a very good reason for Clause 53 to be in the Bill, but I confess that I have reached a Part of the Bill which at the moment I find difficult to understand. At present, if a landlord carries out improvements he is in the normal case entitled to an increase of 12½ per cent. of his expenditure in the rent. If I understand Clause 53 aright, its purpose is to terminate that. Prima facie that would mean that people who had been thinking of carrying out improvements will now stop. That is clean contrary to the general purpose of the Bill, and therefore I presume that there is some reason for Clause 53 which has so far escaped my notice.

I turn to the explanatory Memorandum at the beginning of the Bill, which says: Clause 53 modifies the Rent Act 1968 so that the provisions enabling the r; nt to be increased by 12½ per cent. of the landlord's expenditure on improvements are not to apply where grant is paid under Part I in respect of a dwelling subject to a regulated tenancy. It may be that the wording of Clause 53 is so drafted that it confines the impact of the clause strictly to dwellings subject to a regulated tenancy, but I confess that does not appear on the face of the clause. My one concern in all this is to get the houses improved as rapidly as possible, and my reason for querying this Clause 1s that it seems at first sight to deny the owner of the house any recompense if he spends money on carrying out improvements with the aid of grant. I shall be very grateful if the noble Lord, Lord Kennet, will explain.

Lord KENNET

I shall hope to explain this matter to our mutual satisfaction. If the noble Lord's Amendment to leave out the clause were carried it would enable the landlord under an existing regulated tenancy who carries out improvements with the aid of grant to increase the annual rent (if a fair rent has not been registered) by 12½ per cent. of his net expenditure. It would restore the effect of Sections 21 (5) and 25 (1) of the Rent Act 1968 which deal respectively with contractual tenancies and statutory tenancies and which are disapplied in these circumstances under Clause 53 of the Bill.

Where improvements are carried out with the aid of grant in the case of existing regulated tenancies, Clause 52 together with Schedule 3, provides a scheme for the phasing of the increase in rent up to the registered rent. Under that Schedule, the increase—if it is not less than 22s. 6d. per week—is to be phased evenly over three stages at annual intervals; if it is less than 22s. 6d. per week the maximum increase may not exceed 7s. 6d. per week in any year. The full fair rent will thus be recoverable not later than two years after the fair rent is registered.

Under the present system a condition governing rent attaches to an improvement grant, and it applies for three years. In the case of regulated tenancies the condition limits the rent to the 1963 gross value plus 12½ per cent. per annum of the net cost of the improvements to the landlords, or to such higher amount as the local authority may fix. Under the Bill, rent will no longer be governed by any condition attaching to the grant; instead, the phasing, by providing some abatement of the rent for up to two years, in effect gives some benefit to the tenant from the contribution made by way of grant from public funds. Phasing of the increase in rent in these cases was proposed in paragraph 36 of the White Paper, Old Houses into New Homes(Cmnd. 3602). If the landlord were to be entitled to increase the rent straight away by 12½ per cent. of the net cost of the improvements—which would be the effect of omitting Clause 53—this would limit or possibly nullify the effect of the phasing scheme, depending on how near the 12½ per cent. increase brought the existing rent up to the full fair rent. In these cases the existing rent (which would not have been a registered fair rent; otherwise Sections 21 (5) and 25 (1) would not apply) could possibly be at a relatively high level already.

This is, as the noble Lord said, a complicated and confusing part of the Bill. The essence of the matter is that the Bill as drafted, without the Amendment, proposes to get rid of the old 12½ per cent. provision in these cases because of the new provision for registration with the phasing coming into effect of the registered rent, which we were discussing on an earlier Amendment.

Lord BROOKE of CUMNOR

I look forward to studying carefully in Hansard what the noble Lord has said. But this is a complicated matter, and I am not sure that I have followed it. So far as I can judge, the effect of this Clause 1s to slow down grant-aided improvements. Without the clause the landlord could be certain that he would get his 12½ per cent.; with the clause he will get something, but phased over a considerable period. It appears, therefore, that this Clause 1s contrary to the general purpose of the Bill. However, the noble Lord is obviously convinced that it is an essential part of the Bill and therefore, while I reserve the right to return to it if I find his explanation completely incomprehensible or inconsistent when I read it in Hansard, in the meantime I shall not press my Amendment to leave out Clause 53.

Clause 53 agreed to.

Clause 54 agreed to.

Clause 55 [Restriction on powers of court under section 54]:

Lord BROOKE of CUMNOR moved Amendment No. 25:

Page 30, line 33, at end insert— (6) This section shall not apply if the tenant is entitled to receive supplementary benefit under the Ministry of Social Security Act 1966.

The noble Lord said: I beg to move Amendment No. 25. This is probably, by common consent, a difficult matter. Clause 55 was not in the original Bill; it was introduced by the Government at a late stage in another place and is designed, as I understand it, to protect the tenant who would have difficulty in paying a higher rent. I suspect that the reason why it did not appear in the Bill as originally presented by the Government to Parliament was that the Government are genuinely concerned with the improvement of houses, and did not wish house improvement to be held up because of the chance that a particular house in a terrace was occupied by a tenant who would find difficulty in paying a higher rent. Consequently, I imagine, the Government brought in this new clause.

I entirely agree that one must temper the wind to tenants who cannot afford to pay a higher rent. Nevertheless, at the same time one must recognise that this does strike a blow, which might be quite a heavy blow, at house improvement in many areas. For example, I think it is generally accepted that improvements can be most economically and effectively carried out if they are taken right through a terrace of houses, rather than if Nos. 13, 19, and 27 have to be omitted because there is some difficulty over the tenants in those particular houses. In this clause the Government seems to have surrendered to those difficulties. I am moving this Amendment in the hope that it may reduce the difficulties.

The clause, broadly speaking, protects from the necessity of having to pay a higher rent due to house improvements those tenants who are eligible for rate relief. That is a way of doing rough justice, and of ascertaining those tenants who are less well-off. In this Amendment I am suggesting that the clause should not apply if the tenant is entitled to receive supplementary benefit from the Ministry of Social Security. Under normal supplementary benefit arrangements, as the Supplementary Benefits Commission has taken over from the National Assistance Board the rent is paid by the Commission, as it was formerly paid by the Board. Therefore, if for good and sufficient reason the rent is increased, the Supplementary Benefits Commission would meet that increased rent, just as the National Assistance Board did in the old days.

It seems to me that in the interests of the houses it would be desirable to accept an Amendment of this kind. I think the Government must agree that the Clause itself disadvantages their main purpose of getting as many houses as possible improved. It is brought in for compassionate reasons, in order to protect the tenant with a low income from having to pay higher rent. But if that higher rent would not be paid by the tenant in any case but would be paid by the Supplementary Benefits Commission, there seems to be no reason why the house should be made to suffer and be deprived of the improvements which by common consent it needs.

I therefore hope that perhaps the noble Lord will accept this Amendment, which is moved in no hostile or militant spirit at all. It is simply moved in a desire to be helpful and to ensure that the compassionate terms of Clause 55 may not operate in cases where compassion is not needed, and may not operate in such a way as to bold up unnecessarily that improvement of houses which I knew the noble Lord, Lord Kennet, like all of us, has so much at heart. I beg to move.

LORD KENNET

I acknowledge the noble Lord's desire to be helpful. Since we have a thin Committee I will answer him in shorthand. The point is that you may not be on supplementary benefit for ever. Although it is true that supplementary benefit recipients can in general expect to receive additional benefit to cover a rent increase following improvements—and therefore there is at first sight a case for the noble Lord's Amendment—yet we must consider the position of tenants who are temporarily in receipt of a supplementary allowance. If they are wage-stopped their allowance would not cover any of the rent increase; or if they are near the wage-stop limit they would not get the whole of the increase. But whether or not the tenant was wage-stopped when he returned to work and his supplementary benefit came to an end his income after his return might still qualify him for rate rebate but it would then be too late for him to resist improvement works. In the case of a supplementary pension also his circumstances may change so that while being entitled to a rate rebate he was no longer entitled to a supplementary benefit. As I say I have answered in a form of shorthand. If it is too shorthand I will give the noble Lord and the Committee more chapter and verse for it.

LORD BROOKE of CUMNOR

No, I am sufficiently familiar with shorthand to understand what the noble Lord is saying but I should like him to accept from me that there is the germ of an idea underlying this Amendment. I never supposed it was perfectly drafted to cover all conceivable cases and I never had any intention of pressing the Amendment. But before I withdraw it I should like the noble Lord to undertake to look at this further to see whether something could not be made of this idea. I give him full credit for wanting to see all improvable houses improved and for not wishing that potential improvements should be held up through matters which are extraneous to the condition of the house.

It seems to me that it might still be possible to amend this Clause in some way as would bring it about that the fact that at a particular time the tenant was eligible for rate relief would not be an absolute bar, as it is now under this clause, to the improvement of the house. As I say, I think there is a germ of an idea in this Amendment. I think this clause, having been introduced at a late stage in another place, has not received as much examination as those clauses which stood in the original Bill have done, and I think it will be found over the years that Clause 55 unamended is so rigid that it is going to hold up desirable improvements. I hope, therefore, that the noble Lord will examine this to see whether something can be made of it. Meanwhile, I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause 55 agreed to.

Clause 56 [Supplemental]:

Lord KENNET moved Amendment No. 26:

Page 30, line 38, at end insert— ("(2) The power of the Lord Chancellor under section 106 of the Rent Act 1968 to make rules and give directions for the purpose of giving effect to the provisions specified in subsection (3) of that section shall extend to sections 49 and 54 of this Act.")

The noble Lord said: The purpose of this Amendment is to give the Lord Chancellor power to make county court rules governing the procedure for county court proceedings under Clause 49, which concerns a tenant's appeal against the issue of, or a landlord's appeal against the refusal of, a qualification certificate in "already improved" cases; and Clause 54 which deals with a landlord's application to enter a dwelling and carry out improvements to which the tenant has not consented. The intention is that the rules to be made should, first, enable Clause 49 appeals to be heard by county court registrars, and, second, make the landlord or tenant other than the appellant a respondent to Clause 49 proceedings, because if nothing were done only the local authority would be respondent. These changes meet points which were raised in the Committee stage in the House of Commons.

The possibility of costs being awarded against a tenant on a landlord's appeal is, I believe, already adequately covered by the "costs" provision in Clause 49 (3), which will effectively protect a respondent against any award of appellant's costs except where the respondent has conducted the proceedings improperly. A similar "costs" provision was inserted in the Protection from Eviction Act 1964 and the Rent Act 1965, and there is no reason to think that those provisions have not achieved the desired result. I beg to move.

Clause 56, as amended, agreed to.

Clauses 57 to 59 agreed to.

Clause 60 [Means of escape from fire]:

Lord AIREDALE moved Amendment No. 27: Page 32, line 9, after ("subsection") insert ("may").

The noble Lord said: I simply thought that to insert the word "may" where indicated would make for better English and would make the subsection easier to understand. I beg to move.

Lord KENNET

I am informed that we do not really have to insert the second "may" because it seems that in the existing drafting the word "may" in line 7 relates not only to the words "secure that that part is not used for human habitation" but also to the words "serve a notice under section 16 of the Housing Act.1961." It is a matter of interpretation and the best advice that I have been able to lay my hands on is that one "may" will suffice.

Lord AIREDALE

I think that one "may" will suffice, but I do not think it is very good English. But I am not prepared to divide the Committee on it. I beg leave to withdraw my Amendment.

Amendment, by leave, withdrawn.

Clause 60 agreed to.

Clauses 61 to 65 agreed to.

Clause 66 [Amendments with respect to amount of payments made for well maintained houses]:

8.21 p.m.

Lord BROOKE of CUMNOR moved Amendment No. 28: Page 39, line 13, leave out from ("1957") to end of line 15.

The noble Lord said: I beg to move Amendment No. 28. We have now come to Part V of the Bill which contains a number of improvements that I welcome. Clause 66 is entitled "Amendments with respect to amounts of payments made for well maintained houses." In certain respects it improves these payments but it only does so, if I understand it aright, in cases where the relevant date, within the meaning of Part III of that part of the Schedule so set out, is later than April 23, 1968. If we are to do justice we ought not to limit that justice. In this whole field, the noble Lord knows as well as I do, there has been long-continued ill feeling through the particular application of the law as it stands; and as I have said I welcome the relaxations of the strictness of the law which this part of the Bill offers. My one concern is that in removing some anomalies we shall be creating others.

Having stated the principle of Clause 66, it appears to me that we ought to apply that principle widely to all cases not yet settled instead of confining it, as the Bill proposes, to those cases where the relevant date is later than April 23, 1968—which I believe was the date of the White Paper. I hope that the noble Lord, who must himself have had to deal with many of these hard cases which this Bill is designed to render less hard, will view this Amendment sympathetically.

Lord KENNET

This is the perennial pipe-line problem which you come across whenever you propose to legislate in order to make things better for people. If there is a class of people who are engaged in doing something (in this case parting with their slum properties in return for compensation) and you propose to make life easier for them (in this case by increasing the amount of compensation) the question always arises: Who benefits? Those who are—how far?—through the pipe-line may benefit under the proposals. I think that the Bill as drafted has got it about right. Wherever you put it there are going to be people falling just outside the increased rate of compensation, who fall just before it. This is going to be unwelcome to them. If you put it further back, as the noble Lord proposes, there will be another generation, as it were, of slum owners who would not benefit from it. That would be unwelcome to them.

The purpose of the Amendment is to secure the benefit of the new payments for all owners of unfit houses which were in the pipe-line on April 23, 1968 so that all houses not actually acquired by the authority on that date would be eligible for the new payments.

The question therefore to which the Amendments are addressed is: What should be the appropriate starting date for the Bill's provisions? The Bill is already retrospective; and, I think, very generously so. It looks back to events which commenced after the publication of the White Paper on April 23 last year. The Government considered it right that the changes should operate from that date but in a way which would told a reasonable balance between owners of unfit property and the local authorities who have to make the increased payments. I shall come to the question of the Exchequer in a moment. We felt that it would be unfair to commit local authorities to payments which they could not have reasonably expected when they committed themselves to a particular slum clearance action. So the changes described in the White Paper and contained in the Bill hinge upon the first formal action of the authority—and that is in most cases the declaration of a clearance area. Similarly, owners of unfit property already affected by slum clearance action on April 23, 1968, could not have had any legitimate expectation that they would receive more than the compensation allowed for in the current compensation code at the time—which is still in force now. It is understandable that this is not welcome to them. But the date proposed in the Bill seems to the Government the most logical and defensible one for the introduction of the changes.

There is another point. To go back further as the Amendment proposes would have, I think, rather capricious effects. For example, if everything turned on the timing of the purchase of the unfit house, owners of houses in the same compulsory purchase order might get different treatment. They would be at the mercy of the inevitable leeway and irregularity of the administrative machine and the longer an order took the more likely it would be that an owner would benefit under the new code. Certain local authorities say, and perhaps certain noble Lords, that if this Amendment were accepted extra financial burdens would fall only on to the local authorities. Certain local authorities may be thinking, "It is up to us; why should we not be more generous, since it is we who pay?"

This is not the whole story. There would be extra financial burdens on the Exchequer by way of subsidy on cleared land used for new housing; and this would not achieve any increase in the rate of slum clearance because the houses affected by these Amendments were already in the pipe-line in April, 1968. The extra cost of slum clearance as a result of the Bill's provisions as drafted is likely to be about £5 million or more in a full year. This, I think, is a price well worth paying for the acceleration in slum clearance which will result once the owner-occupier's grievances are removed. But if the relevant date were made, say, the date of the actual purchase of the property, the additional cost over that £5 million would be more than £6 million—and almost all of that would have to be met in the near future.

So I hope that in view of the financial considerations and in view of what I believe will be the increase in uncertainty and dubiety as between different cases in the same part of the same town, the noble Lord may think it would be best to leave the commencing date for the new code at April 23, 1968.

Lord BROOKE of CUMNOR

It will have become apparent to the Committee that I have down a series of three Amendments, which have broadly similar purposes, to Clauses 66, 67 and 68. It is only the Amendment to Clause 66 to which I have spoken so far; and I certainly find it surprising to hear that if the Amendment to Clause 66 were accepted it would increase the cost falling upon the local authorities by £6 million a year. If that is so, I shall be greatly interested to hear what the additional cost expected under Clauses 67 and 68 would be if my Amendments were accepted. I do not wish to argue these at length. I want to ask in every case whether the Government will re-examine these matters between now and the final stage of the Bill. My own judgment is that people whose cases have already been settled will reasonably accept that the question of their payment could not be reopened as a result of this Bill. But where cases have not been settled I think there will be a very strong feeling that this date of April 23, 1968, is artificial as a dividing line. I have No information about whether local authorities would object to my Amendment to Clause 66. I shall be able to speak with confidence about their attitude when we come to Clause 68, but certainly it had appeared to me that the costs involved in my Amendments to Clauses 66 and 67 were probably considerably smaller than those that were involved in Clause 68.

My general belief is that where Parliament declares a new principle, as it is doing in each of these clauses, it is desirable that the new principle should be applied to settling all outstanding cases at the time of the legislation, whatever the original date of declaration—or the relevant date, or whatever it may be called—has been. I am not going to press this Amendment, but I shall ask on it, as I shall ask on the Amendments to Clauses 67 and 68, whether the Government will re-examine these matters sympathetically between now and the closing stages of the Bill to see whether by some Amendment, either by mine or some other, the quantity of painful anomalies may be reduced. I beg leave to withdrawn the Amendment.

Lord KENNET

Before the Question is put, may I say that I owe the noble Lord, Lork Brooke of Cumnor, a humble apology on procedural grounds. My remarks were addressed to the group of Amendments about the back-dating down the pipe-line—Amendments 28, 29, 30 and 31—which I think the noble Lord will agree stand together. It is true that he did not say that he was speaking to all four of them, but I am afraid I did not notice that and took it that he was. My observations about the financial effects were, of course, related to the totality of the group and not to Amendment 28 alone. I should perhaps revert to the question of the £5 million and £6 million as I may not have made it clear that £5 million would be the extra cost of slum clearance under the Bill as drafted, and £6 million would be the extra cost of slum clearance under the Bill as drafted and as amended by the noble Lord in this series of Amendments. I am glad that he is not going to press them upon the Committee this evening, and I will readily undertake to look again at this matter; though I should say that I foresee pretty grave difficulties, which I had already adumbrated, about coming to any different conclusion than that embodied in the Bill as drafted.

Amendment, by leave, withdrawn.

Clause 66 agreed to.

Schedule 4 agreed to.

Clause 67 [Payments in respect of partially well maintained houses or parts of buildings]:

8.34 p.m.

Lord BROOKE of CUMNOR moved Amendment No. 29: Page 39, line 21, leave out from ("maintained") to end of line 30.

The noble Lord said: I beg to move Amendment No. 29, and I think I can do so shortly, as the noble Lord, Lord Kennet, believes that he has already covered this and my next Amendment in his previous comprehensive reply. If he is able to break up his figures of £5 million and £6 million as between Clauses 66, 67 and 68, that would be of interest. So far as I am aware, Clause 67 introduces a new concept, the partially well maintained houses or parts of buildings—the case where either the exterior or the interior of the house has been well maintained. If here we are introducing that new concept I should have thought the argument was overwhelming to apply it to all individual cases not yet settled rather than to have the cut-off dates that are set out in the paragraphs (a) and (b), the paragraphs that my Amendment is designed to delete. Obviously, I need not speak at length about it, but I mast get on the Record that I have moved it formally. If the noble Lord is in a position to split up his global figures of £5 million and £6 million between the three clauses, that would be of considerable interest.

8.35 p.m.

Lord KENNET

The noble Lord is perfectly right. This provision is about houses partially well maintained inside or outside at the half rate, and is an entirely new concept. It was first announced on the publication of the Bill. It will take effect under the Bill as drafted after the enactment and there is no provision for back-dating. It would in fact be impossible to provide for back-dating on these partially well maintained payments because the houses will have been inspected on the basis of full maintenance in the traditional way until the Bill comes into force; so there will be no separate examination of the inside as opposed to the outside, or the outside as opposed to the inside, until this new drill goes into effect. The amount of money involved in back-dating the new rate of well maintained payments is small compared with the equivalent back-dating of the owner-occupied subsidies. Only about 11 per cent. of the tenanted houses qualify for payment and the additional cost might be of the order of £500, 000.

Lord BROOKE of CUMNOR

I have put my views on record and I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause 67 agreed to.

Clause 68 [Payments to owner-occupiers and others in respect of unfit houses purchased or demolished]:

Lord BROOKE of CUMNOR moved Amendment No. 30:

Page 40, leave out lines 25 to 31, and insert—

1. ("(a) the house was purchased or vacated after 23rd April 1968, in pursuance of an order within the meaning of paragraph 4 (1) of that Schedule; or
2. (b) the house was purchased after that date in pursuance of an order made under Paragraph 2 of Schedule 2 to the Land Compensation Act 1961;").

The noble Lord said: I beg to move Amendment No. 30. The noble Lord, Lord Kennet, will perceive that Amendment No. 31 to Schedule 5 is linked with it. This is, of course, much the most substantial of these three Amendments. In this case I can say with assurance that the local authorities principally concerned are very anxious that the Bill shall be amended, either on the lines of my Amendment or in some other way. I have received representations on this matter from the Association of Municipal Corporations and from the Greater London Council and these bodies must between them cover most of the unfit houses which would be affected by this clause.

I welcome the general provisions of the clause so far as it goes, but I am seriously concerned about the anomalies that are going to arise. I know that the noble Lord, Lord Kennet, feels that he has given an answer to this Amendment and I do not wish him to reply at length; though I am sure he would not demur to my stating my case on this Amendment as I have done on the others. If I understand rightly, the additional payment which this clause will enact will be available to houses which are owner-occupied in cases where what is called the appropriate action is taken after April 23, 1968. The appropriate action may take various forms, but the typical case is that where the local authority declare a clearance area covering the unfit house that is in question. In such cases it is the date of the declaration that will affect whether or not the owner-occupier will be entitled to the benefit of Clause 68. It will be so if the declaration of the clearance area or the appropriate action, whatever other form it may take, was after April 23, 1968. A great many city councils and borough councils declared clearance areas before April 23, 1968, but have, as yet, acquired few, if any, properties in those areas. This is a common situation because local authorities are very hard pressed in this matter of slum clearance.

If one takes two cases—they may be adjacent cases—where the declaration occurred before April 23, 1968, there will be no benefit from this clause to the owners even though their actual houses may be acquired later than similar houses in other clearance areas declared after April 23, 1968, which will get the benefit of this clause. There is undoubtedly going to be a very keen feeling of injustice if the clause goes through unamended, and my Amendments are to apply the date of April 23, 1968, not to the declaration of the clearance area (or whatever the appropriate action has been), but rather to the date of the completion of the purchase of the house or other contingent happenings which may correspond to that. This, it seems to me, will be much more likely to be accepted as fair.

Quite frankly most people owning property, most owner-occupiers in a clearance area, are not likely to be explicit in their minds as to the date when a clearance order was made. There will be no doubt whatever in their minds as to the date when their property is compulsorily acquired or they are made to vacate it. That is the meaningful date for them and I am suggesting that it should be that meaningful date which should apply to determine whether or not they are entitled to the additional payments. I sincerely believe that this will reduce the number of anomalies. I am not suggesting it will eliminate all the anomalies, because it would be quite impossible to eliminate all anomalies, but at any rate those anomalies which remain will be confined to cases where the purchase of the property had been completed before April 23, 1968, which is some way back; there could be no anomalies among people whose property had been purchased since that date.

I cannot see that this Amendment would do any harm except to the local authorities who have to find the money. The local authorities themselves have said that they are anxious to find the money because they know it is a handicap and a brake to successful slum clearance if there is strong local feeling that owner-occupiers are being unfairly treated. I greatly hope that the noble Lord will seriously examine this point. I am speaking for a strong body of opinion, not only the owner-occupiers themselves, and I most seriously believe that a real effort should be made either in this way or in some other way to reduce the anomalies which will otherwise damage the atmosphere for continued and succesful slum clearance. I beg to move.

Lord KENNET

I have already said something about this precociously and I have said I will look at it. I foresee difficulties, partly because of the Exchequer subsidy which these proceedings attract. So it is not solely a matter of increased local authority expenditure which they might properly wish to make whatever the central Government think about it but also this point of different results cropping up in the same slum clearance area. If the noble Lord will consider a clearance order which came into effect in April, 1967, then let him consider two householders within that order, one of whom had his house compulsorily purchased in March, 1968, and one of whom had his house compulsorily purchased in May, 1968. What would they think about the effect of his Amendment? However, I have said that we will look at the point again, and that is the sort of difficulty we must look at.

Lord BROOKE of CUMNOR

I quite accept that there will be some sort of anomaly, wherever you draw the line, but I think the anomalies will be less keenly felt where cases have actually been settled some time ago than where cases are now being settled and yet, owing to this clause as drafted, are having to be settled under forms of compensation which Parliament has already rejected for the future. I am grateful to the noble Lord for what he has said. I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause 68 agreed to.

Schedules 5 and 6 agreed to.

Clauses 69, 70 and 71 agreed to.

Clause 72 [Power of local authority to require repair of house]:

8.45 p.m.

Lord BROOKE of CUMNOR moved Amendment No. 32:

Page 42, line 7, at end insert— ("Provided that no such notice shall be served if the income of the landlord is such that he would be entitled, if he were a tenant, to the protection of section 55 of the Housing Act 1969.")

The noble Lord said: I beg to move Amendment No. 32. Clause 72 empowers a local authority, where a house is in such a state of disrepair that although it is not unfit substantial repairs are required to bring it up to a reasonable standard, to serve a notice on the person having control of the house to execute the works specified in the notice. My Amendment is designed to provide the same sort of safeguard to the poverty-stricken owner as by Clause 55 the Government are offering to the poverty-stricken tenant. I need not quote cases of poverty-stricken owners because the Minister himself did it in his Second Reading speech. He pointed out that a very large number of these houses in question are owned by single individuals, many of them elderly; and that where these houses are still rent-controlled the rent payable has for many years been quite inadequate to keep the house in repair.

Therefore there are (and I believe this is universally accepted) a large number of houses owned by individuals, many of whom have inherited the houses, and simply have not got, either from the rent or elsewhere, the money to keep the house in good repair. It would be unreasonable for the local authority to ignore that fact and to seek to extract money for repairs from a person who had not got that money. As the Government thought fit to protect, under Clause 75, from the necessity of paying extra rent for improvements the tenant who really cannot afford to pay any more, so I propose in this Amendment that the owner who cannot afford to ca[...]y out the necessary repairs required by the Authority should be protected in a similar way. I beg to move.

Lord KENNET

The clause as drafted exempts statutory tenants whose income is within the limits for rate relief as certified by the rating authority from having a court order made against them under Clause 54. The Amendment seeks to debar a local authority from serving a repairs notice on a landlord who, if he were a tenant, would be protected by Clause 55. In the Government's view, there is a substantial difference between forcing an impecunious tenant to accept improvements and getting a landlord to carry out his obligations with regard to repairs. It may be difficult for a landlord under a controlled tenancy to find money for repairs out of a rent controlled at its 1957 level—indeed, my right honourable friend said on Second Reading that the cost of repairs had increased by over two-thirds since 1957.

In my submission, however, the Bill as it is before us will help the landlords in a good many other ways. There are the provisions dealing with the conversion of tenancies from control to regulation, which we have just discussed, where the dwellings satisfy the qualifying conditions. The landlord has his rent increase to look forward to. Landlords will also be able to get improvement grants towards some of the repairs they carry out, provided they are associated with improvements. This is something quite new in this Bill. There has been No improvement grant like this previously, and it is now up to a sum which is half of the total expenditure on repairs.

Clause 72 says that the repairs required must be such as to bring the house up to a reasonable standard, having regard to its age, character and locality. The key is what is "reasonable." This is not a matter for the housing authority alone: it is for the housing authority first and then for the county court, on appeal. Since there is an appeal to the county court, the local authority will inevitably consider the reasonableness of their requirements carefully before they proceed. Moreover, they have a power to act—not a duty—and they will not want to endanger the progress of their general improvement area plans by provoking criticism through too stringent demands on poor landlords. I hope that bearing in mind all the other things in the Bill that will have the effect of protecting landlords against unreasonable conduct, and, I would add, the intrinsic character of most local authorities, which is to avoid unreasonable conduct, the noble Lord will think that the Bill is all right as it stands.

Lord BROOKE of CUMNOR

With great respect to the noble Lord, that is not one of the best of his answers. I believe that there is a real problem here. The noble Lord, in resisting this Amendment, argued that no local authority would act unreasonably. But, as his Minister acknowledged on Second Reading, a large number of individual landlords will be in difficulty if local authorities take advantage of this clause. If I may quote from the Minister, he said: There seems little doubt that these 1957 rent levels have meant in many cases that repairs have been neglected. I had a case only a week ago of an old lady in my constituency who owned two rent-controlled houses. The tenants of each paid 10s. 6d. a week in rent. She has just spent £40 on repairs and is now faced with spending a further £25 or £30. That is all right if that particular old lady has some income from elsewhere, but it is not all right if she has not. I am certain that the Government recognise in their hearts that there is a large number of people who own one controlled house in that sort of state and have not the money from the rents, or the rents as this Bill may eventually increase them, to carry out the repairs which under this clause the local authority may require.

I am tempted to press this Amendment but the hour is late and it may not in itself be a perfect Amendment. What would influence me would be if the noble Lord would say that in a circular, which no doubt the Minister will eventually send out when this Bill reaches the Statute Book, local authorities will be told to pay attention to the sort of reasoning which he has just expressed in his speech. It is no use their trying to apply Clause 72 strictly to individual landlords who simply have not the money to do it. It is not reasonable on their' part. My fear is that local authorities may feel that Clause 72 requires them to act in this way in every case and to fight it out in the county court, if necessary. They may feel that because that is pretty well what the clause says. Therefore it would greatly help me if the noble Lord and his Minister would, by some means or other, seek to remind local authorities that though this may be an extremely valuable power to use in certain cases it would be a mistake to use it in those cases where there was not the slightest chance of a landlord being able to afford to carry out the repairs which a strict local authority would require him to do under this clause.

Lord KENNET

I am rather distressed by these repeated requests to send out circulars to explain that the law does not mean something which it does not say. It is perfectly clear that there is only a power to do this, not a duty; and I should have thought that most local authorities were well able to see that they cannot get blood out of a stone and that the way to proceed is reasonably, as indeed the Bill lays a duty on them to do. They must be reasonable. They are not bound to use the compulsory powers against landlords unless they judge it right to do so. However, I have taken the noble Lord's point, and when I am able to read Hansard I will examine his worries again with an open mind, and we can if necessary come back to it again.

The Earl of CRANBROOK

I wonder if the noble Lord would take one other point into consideration. Sooner or later we are going to have a form of local government reform which means that every individual elected member of a local authority will be farther away from this sort of administrative problem, which more and more will have to be left to permanent officials. In a case of this sort, in which discretion has to be exercised, it depends on its being exercised by somebody who is not a permanent official and takes the responsibility. And it means that we should lay down the law here rather more specifically than in the old days, where the individual member of a council was able to exercise the discretion himself.

Lord KENNET

When it comes to local government reform, and if it takes the shape recommended by the Royal Commission Report, there will be a point in what the noble Earl says.

Lord BROOKE of CUMNOR

The noble Lord, Lord Kennet, accused me of seeking to urge the Minister to send out lots of circulars. I should not dream of doing that, but if the Minister thinks that he can pass a Bill of this magnitude into law and not send out a circular about it, he will be in serious trouble with the local authority associations. There may be a difference of approach between him and me, but there is a real problem here, and I hope that together we may find some means of mitigating it. Having said that, I beg leave to withdraw my Amendment.

Lord KENNET

With the patience of the Committee, I was not proposing that the Minister should not send out a circular about this Bill. But I hope that the circular he sends out will be confined to saying what the law is and about how to use it, and will not go too deeply into asserting that the law does indeed not say that which it does not say.

Amendment, by leave, withdrawn.

Clause 72 agreed to.

Lord KENNET moved Amendment No. 33: >After Clause 72 insert the following new clause:

Increase of fine under s. 170 of Housing Act 1957

". Section 170 of the Housing Act 1957 (power of local authority to require information as to ownership of premises) shall have effect, with respect to offences committed after the commencement of this Act, as if for the words 'five pounds' there were substituted the words ' fifty pounds '".

The noble Lord said: This Amendment, which hangs together with Amendment No. 59 to the Title, deals with the giving of false information. Section 170 of the Housing Act 1957 enables a local authority to require information as to the ownership of premises for certain purposes. Apparently the fine for false information stands at £5. That was settled in 1930. The purpose of the Amendment is to raise the £5 to £50 which is more in accordance with the value of money in this day and age.

Clauses 73 to 76 agreed to.

9.2 p.m.

Lord BROOKE of CUMNOR moved Amendment No. 34: After Clause 76, insert the following new clause:

Contributions towards strengthening high blocks of flats

". In so far as a local authority is required to incur additional expense on strengthening high blocks of flats in order to safeguard against a repetition of the Ronan Point disaster, the Minister may make a contribution to the authority equal to one-half of the additional expense so incurred."

The noble Lord said: I beg to move the new clause dealing with the means of paying for the additional work in which local authorities have been involved in the course of safeguarding against a repetition of the Ronan Point disaster. I realise that this is a matter of money, and your Lordships' House normally leaves money matters to another place. I would not have tabled this new Clause if I did not feel so strongly that the Government must reconsider the very unfair decision which they have so far made and maintained as to the inadequate amount of Exchequer help to be given to these local authorities.

Every member of the Committee will be familiar with the Ronan Point disaster. They will realise the terror which that set up among tenants of other high blocks of flats with a similar mode of construction. Unquestionably, following the report of the inquiry into the disaster, it was essential that local authorities which had built high blocks of flats that were shown to be vulnerable to similar disasters must take action to safeguard the lives of their tenants and the stability of the buildings. That has involved, and is involving a very large sum of money. The noble Lord, Lord Kennet, may be able to give the latest authoritative estimate. The figure I am in a position to give is £25 million, a very considerable addition to local authority expenditure, bearing in mind that this is not spread equally over local authorities but falls selectively on those local authorities which usually, because of the urgency of their housing problem and lack of land, have been forced to build high. It is expensive to build high, and few local authorities wish to do so if there is another means of meeting their housing problems. But it is well known that certain local authorities have found it inevitable to build high and now they are being very heavily penalised.

The Government have so far said that the Exchequer will meet no more than 40 per cent. of the additional cost which local authorities will incur or are incurring through the necessity to strengthen their high blocks of flats. If my figure of £25 million is correct, that means that the Government is meeting £10 million, and the relatively small number of local authorities with acute housing problems which have very high blocks of flats have to meet the remaining £15 million. The Government said at one stage that whatever happened it should not fall on the tenants, but it is clear that a large amount is going to fall on the ratepayers of the boroughs concerned, including the tenants. These boroughs and cities are places with acute housing problems and with lack of land, otherwise they would almost certainly have gone in for lower and cheaper forms of construction. In other words, they are the authorities which tend to have heavy housing outgoings in relation to the product of a 1d. rate, in relation to their rateable wealth so to speak.

I should have thought that it stood to reason that the Government should relieve such local authorities of much more than two-fifths of the cost. I seek to bring in a very modest new clause saying that it should be fifty fifty. I do not think it should be fifty per cent. I think if local authorities paid 20 per cent. and the Government 80 per cent. that would still fall heavily on local authorities. The reason why I am proposing the fifty fifty division is that a new clause was moved by a Government supporter in another place suggesting that the 40/60 position should be reversed and should become 60/40—the 60 per cent. on the Exchequer and 40 per cent. on the local authorities. In a vote in which it was clear that a number of Government supporters were very uncomfortable, this new clause, moved from the Government Benches, was defeated. It seemed inappropriate to move exactly the same new clause as the Commons had already rejected. I am bound to say that I am in considerable trouble with some of the boroughs and cities concerned who think I am letting them down by pressing for only a fifty fifty split, whereas they think, and I think, it would better be an 80/20 split. It seemed to me that if I were to ask for more than the Government had already refused in another place I might have no chance at all of success. But if I asked for something which was less than justice—less than the Exchequer ought to be prepared to make available to these hard-pressed local authorities—then I might by these means be able to persuade the Government to think again.

I feel that if the Government do not move on this they will severely damage their relations with urban housing authorities. There is intense feeling that this 40 per cent. offer by the Government is inadequate; and it is not confined to those boroughs and cities which are affected, but has gone through the whole of local government. For all other local authorities are perfectly well aware that it was a matter of chance that certain housing authorities were hit by this; that there might have been a disaster of a different kind, and the colossal additional cost might have fallen on other housing authorities.

I beg with all my power that the Government will give fresh consideration to this. It is not wise to sail on a collision course with the local authorities as a whole. I do not believe that anybody, except those who went into the Lobby out of Party loyalty in another place, believe that the Government have acted fairly in offering only 40 per cent. I am quite sure that if the Government were now to make a more generous offer, it would sweeten relations between the Government and the local authorities, and give the local authorities a return of confidence, which has been very badly shattered (I say this with knowledge) as a result of the Government's action over Ronan Point. I beg to move.

Lord KENNET

The noble Lord said he was afraid that he was going to get into trouble with the local authorities for proposing only 50 per cent. Government grant on this account. I am sorry to hear it. The local authorities are, of course, in direct contact with the Minister. They came along; there was a meeting; and they asked for 100 per cent. They just landed the whole problem in the lap of Central Government. The noble Lord is more equal in his divisons at 50-50. The Government, as the Committee know, propose 40-60; that is to say, the Government propose 40 per cent. from Exchequer funds.

I was struck by what the noble Lord said about the other 60 per cent. having to come from the local authorities. The Tribunal of Inquiry, in their Report, if the thing is taken as a whole—and I do not suppose the noble Lord would dissent from this—allotted a broad spread of responsibility, not between the two parties, central and local government, but between three—central Government, local government and a third party which the noble Lord did not even touch upon; that is, industry and the professions concerned. Because if a block is built and it falls down, who is involved? The designer of the system used, the architect of the particular block, the consultant who advised on the use of the system—are these people not involved? I conceive that they are. I conceive that their professional standards are in question in this matter. I conceive that if a block falls down, and if other blocks of a similar nature have to be strengthened at great expense, part of the responsibility is theirs. The Tribunal of Inquiry said this, and I agree with them. Part also, no doubt, is the responsibility of the local authority which ordered the block and approved it; and part is the responsibility of the central Government which laid down the book of rules under which the proceedings were conducted. It is the view of the Government that 40 per cent. correctly reflects the responsibility of central Government in this tripartite allotment of responsibility for what has to be done as a result of the disaster.

If I may concentrate for a moment on the part which will have to be paid by the local authorities themselves, the middle party, the noble Lord, Lord Brooke, pointed out the remarks of my right honourable friend about how the expense certainly ought not to fall on the tenants; and he said it looked as if it would. I think what my right honourable friend had in mind was that the expense ought not to fall on the tenants of the blocks which had to be strengthened, where all this money would have to be spent. Unfortunately, some of it. is bound to fall on the tenants of that council, because some of it is bound to fall upon the rates, and they are ratepayers. Equally, if the Government were to pay more, like the 50 per cent. proposed by the noble Lord, some of it would fall on the very same people as taxpayers. I wanted to make that distinction between tenants in the blocks concerned and council tenants in the area of the local authority as a whole.

I hope I have said enough about this question. It is not a bipartite division of responsibility between central and local Government; it is tripartite between central Government, local government and those professionals and industrialists who put up the blocks which have been found, to everybody's surprise—and I freely admit to everybody's surprise—not to be good enough.

Lord BROOKE of CUMNOR

The noble Lord did not confirm or deny the estimates of £25 million which I made as to the total additional cost.

Lord KENNET

I should not wish to quarrel with that, but it must remain a very provisional estimate at the moment because the costing is by no means finished. The best I can say is that it may well turn out to be about that in the end. We simply do not know yet.

Lord BROOKE of CUMNOR

The noble Lord has confirmed my view that it is of that order of magnitude, and whatever monies may be available from other quarters, it still remains perfectly clear that out of that £25 million a very substantial unexpected and unexpectable burden has to fall on a small number of local authorities which have been striving to mitigate their housing problems by building tall blocks of flats owing to their shortage of land.

Lord KENNET

I am sorry to interrupt the noble Lord, but I have not confirmed his view that it is likely to turn out to be of that order of magnitude. I have only said that I have no reason specifically to challenge that figure. It may be that; it may be another. It is not likely to be of that order of magnitude; it is quite possible that it will be of that order of magnitude.

Lord BROOKE of CUMNOR

I think we can take £25 million as the only figure that is worth talking about at the moment because we have no other. On a financial matter like this it would be inappropriate for me to press this new Clause in your Lordships' House. I can only express bitter disappointment, and I can but say with the authority of a former Minister of Housing and Local Government that the behaviour of the Government in this matter is not the way to gain, to keep and to strengthen the confidence of the local authorities in central Government. Housing Acts can operate successfully only if there is a genuine feeling of partnership between the Ministry and the local authorities. It is that feeling of partnership which the Government are damaging by their mean decision on this Ronan Point affair.

Lord KENNET

If the noble Lord will permit me, I wonder whether I could put one question to him. Would he admit that there should also be a feeling of partnership between the local authorities, the industry and the consultant?

Lord BROOKE of CUMNOR

Yes; but I cannot tell what the contractual arrangements were there. I do not have the information on all these cases, whether indeed the building regulations were complied with and whether in any particular case they were nationally approved regulations or locally approved regulations. That has to be gone into in every case. I beg leave to withdraw the new clause.

Amendment, by leave, withdrawn.

9.17 p.m.

Lord BROOKE OF CUMNOR

had given Notice of his intention to move the insertion after Clause 76 of a new clause dealing with assistance to students' housing associations. The noble Lord said: In view of the lengthy discussion we had about student housing associations and the manner in which the noble Lord, Lord Kennet, took up my suggestion that there should be discussions under Parliamentary auspices of the ways in which the Government might be able to further the aims of student housing associations, at this time of night it would be suitable if I did not move this new clause. We can discuss it later.

Lord KENNET

Could I just clarify the use of the words, "Parliamentary auspices "? That slightly suggests some Parliamentary Committee of Inquiry. I know that is not in the noble Lord's mind. What I had in mind was simply an informal meeting and discussion. An "auspice" sounds a little formal.

Lord BROOKE of CUMNOR

I think we are at one about this. When I said, "Parliamentary auspices" I meant that Members, at any rate of the Upper House of Parliament, will be present.

Clause 77 agreed to.

Lord KENNET moved Amendment No. 36: After Clause 77 insert the following new clause:

Right to terminate period for which option notice has effect

".—(1) In section 24 (3) of the Housing Subsidies Act 1967 the following shall be inserted after paragraph (vi)— (vii) the taking effect of a notice under section 26A of this Act.'

(2) After section 26 of that Act there shall be inserted the following section:— '26A.—(1) Where an option notice has been given in respect of a loan the person or persons in whom the rights and obligations under the repayment contract are for the time being vested may by notice to the lender bring the period for which the option notice has effect to an end on 31st March of any year not earlier than 1973, but only if not less than five years have then elapsed since the date of the repayment contract. (2) A notice under this section must be in writing and in such form as the Minister may direct and must be given not less than three months before the date on which it is to take effect.'

The noble Lord said: This new clause concerns the option mortgage scheme. Its purpose is to give a person who has taken an option mortgage in preference to tax relief on the mortgage interest the right to get out of the scheme and revert to tax relief. This right arises five years after the borrower entered the scheme or any subsequent year after that, but it is a once-and-for-all choice. At the time of the passing of the Housing Subsidies Act 1967 the lending agencies were adamantly opposed to anyone's being allowed to opt out, on the grounds of the administrative inconvenience involved if people were to move in and out of the scheme. The Building Societies' Association since then have reiterated their objection. As a recent discussion with the representatives of the lending agencies, they all agreed—and this was a change in position—to a man's being allowed to opt out after five years.

The benefit of an option mortgage ought to be looked at over the life of the mortgage, and Clause 77 allows the rates of subsidy to be increased, which removes one ground for wanting to get out. If after five years a borrower wants to get out of the scheme, it is reasonable to let him do so, and I am very glad—and I believe the Opposition is also glad—that the lending agencies have come to the conclusion that this is acceptable to them. I need hardly add that the Amendment comes so late in the course of the Bill through Parliament solely because it was only the other day that the lending agencies came to their conclusion. I beg to move.

Lord BROOKE of CUMNOR

I certainly welcome this new clause and I am glad the Government have been able to do this. At this late hour I will not speak at length. I will simply mention that a certain amount of Parliamentary time could have been saved if the Government had accepted a new clause moved by the Opposition in another place to do just this, instead of resisting it then and bringing forward the clause themselves in Committee in your Lordships' House. However, after that little bit of teasing, I should like to thank the Government for what they are doing.

Lord KENNET

If I may tease the noble Lord back, it would have involved brow-beating the building societies into something they did not want to do at that stage—and I think they are his friends.

Clause 78 agreed to.

Clause 79 [Other long tenancies]:

9.22 p.m.

Lord KENNET moved Amendment No. 37: Page 46, line 20, leave out from ("it") to ("be") in line 21 and insert ("Schedule 7 to this Act shall apply and, if the tenancy was granted before the commencement of this Act,").

The noble Lord said: Because it is getting late I am going to try to get by with "shorthand" on this one again, though of course I will instantly give the full background if any noble Lord should require it. This is a very complicated matter about long tenancies and the clause as drafted—I hope I make myself clear to those who are on top of the situation—contained both "belt" and "braces", but the "braces" were sufficient and the "belt" succeeded only in squeezing out a few deserving cases which we recently identified, and the Amendment removes the "belt". I beg to move.

Lord BROOKE of CUMNOR

The noble Lord has now switched to a more inscrutable form of "shorthand" and I am quite sure that I cannot interpret it easily. On the other hand, if he were to read out a lengthy brief I am not at all sure, at this late hour of the light, whether I should find it any more comprehensible. If he will assure me that what he has said makes sense in the cold light of morning, I will read it carefully.

This is a difficult clause. I think he will confirm that it was introduced at a fairly late stage in another place and therefore it did not get as intensive an examination as was given to all the clauses in the Bill as originally presented to Parliament. I hope to find that what he is proposing by this Amendment is all right, but I should like to reserve my position as long as he discusses it in any form of "shorthand".

Lord KENNET

In view of what was said in another place about this matter, I am fairly confident in saying that the noble Lord will find it all right.

Lord KENNET moved Amendment No. 38: Page 46, line 26, leave out from beginning to ("it") and insert ("within twenty years of the date when")

The noble Lord said: This Amendment is designed to eliminate a small anomaly which was pointed out in the debate on the Report stage in another place, and was also drawn to the attention of the Government by the Law Society. Once again, I think perhaps, unless any noble Lord wishes me to go into detail, it may be enough if I simply move this with that much explanation. I beg to move.

Lord KENNET moved Amendment No. 39: Page 46, line 28, after ("granted") insert ("before the passing of this Act or was granted")

The noble Lord said: The rent variation condition in Clause 79 (2) (b) is aimed directly at the prevention of abuse by landlords seeking to capitalise from scarcity. It is therefore not so essential to apply it to existing leases as to future leases. To apply it to existing leases has now been shown, as a result of helpful approaches by the Law Society and others, to deprive a number of genuine long leases with real capital value of the benefit of this clause. The proposal not to apply it to existing leases will not benefit any freeholder. Some tenants with genuine long leases will now benefit, as they should do, while others who hold leases which are basically rack rent tenancies dressed up as long leases will, for the most part, get no benefit.

The type of geniune lease which, if the Amendments I am proposing are made, will still fail to benefit from Clause 79 (2) (b) is the sub-lease which provides for a rent review within a period of 20 years from the date on which it was granted but where there is a superior lease of the dwelling which itself satisfies the condition in Clause 79 (2) (b). A sublease may not be granted until some years after the grant of the superior lease, and it may well be essential for the sub-lessor to ensure that the dates for rent review in the sub-lease which he grants shall coincide with the dates for rent review in the superior lease. The new subsection (2) will now cover this case. This is complicated and professional stuff indeed, but I beg to move—though I am ready to give further explanation if desired.

Lord BROOKE of CUMNOR

I would rather read in Hansard what the noble Lord has said before passing any comment.

Lord KENNET moved Amendment No. 40: Page 46, line 36, after ("underletting") insert ("of the whole of the premises comprised in the tenancy").

The noble Lord said: These are a run of extremely difficult and abstruse Amendments, but some of them do have some substance, and I think I should get it on to the Record what they are about, even if it is in shorthand. Subsection (2) (c) embodies the principle that to have the capital value that would justify rendering it freely saleable a tenancy should be assignable, since otherwise the capital value of the lease would depend on the tenant's remaining in occupation, which he might not find convenient if his circumstances changed. The Law Society has, however, pointed out that it is not uncommon for leases to permit the assignment of the lease of the whole premises let while prohibiting assignment or sub-letting of part of them only. This prohibition, which is designed to preclude reduction in the value of the premises let or of the lessor's adjoining property, is in no way at odds with the principle of free assignability, the object of which is that the tenant, if he wishes to move, should be free to sell the contractual right of occupation he has himself acquired.

It is thought that proviso (c) as drafted would exclude from free saleability leases embodying the prohibition. This Amendment is therefore required to make it clear that a lease incorporating a prohibition on partial assignment or sub-letting complies with proviso (c), so long as the lease of the premises as a whole is assignable. I beg to move.

Lord KENNET

This Amendment, too, is to cover a point recently made by the Law Society. I think those who have to know what it means will understand what it means, taking the Amendment together with the clause as drafted. I beg to move.

Amendment moved— Page 46, line 40, leave out from ("term") to ("offer") in line 41 and insert ("requiring in connection with a request for consent the making of an").—(Lord Rennet.)

Lord KENNET

Amendment No. 42 is conseqential on Amendment No. 39. I beg to move.

Amendment moved—

Page 46, line 41, at end insert— ("(3) Where the condition specified in subsection (2) (b) of this section would be satisfied with respect to a sub-tenancy but for a term providing for one variation, within twenty years of the date when the sub-tenancy was granted, of the sums payable by the subtenant, that condition shall be deemed to be satisfied notwithstanding that term, if it is satisfied with respect to a superior tenancy of the premises comprised in the sub-tenancy (or of those and other premises).")—(Lord Kennet.)

Clause 79, as amended, agreed to.

Schedule 7 [Amount of Premium Permissible under Section 79]:

Lord KENNET

This Amendment is consequential on Amendment No. 37 already accepted. I beg to move.

Amendment moved— Page 65, leave out lines 14 and 15 and insert ("on the grant or an assignment of the tenancy").—(Lord Rennet.)

Lord KENNET

This is a drafting Amendment. I beg to move.

Amendment moved— Page 65, line 28, leave out ("it") and insert ("the tenancy").—(Lord Kennet.)

Schedule 7, as amended, agreed to.

Clause 80 [Price payable on enfranchisement of leasehold house]:

On Question, Whether Clause 80 shall stand part of the Bill?

9.31 p.m.

Lord SILSOE

It is my hope that this clause will not stand part of the Bill. I should like to express my gratitude to some of those who sit on these Benches who have been kind enough to remain here to speak about it. Clause SO has nothing whatever to do with the Housing Bill; indeed, the Long Title of this Bill had to be altered in order to get it in. It deals with the Leasehold Reform Act 1967 and seeks to amend this in an important particular.

The clause, I think although it is late at night I must explain, because it has not yet had to be explained at all to your Lordships, says: This Section is to have effect and be deemed always to have had effect as if in section 9 of that Act there had been inserted after the words ' a willing seller' the words 'with the tenant not buying or seeking to buy'. Putting that shortly, it prescribes that when a tenant wishes to enfranchise his lease and buy the freehold the pries that the tenant would offer is to be entirely disregarded in fixing the compensation.

In moving the Second Reading the noble Lord, Lord Kennet—may I say I have no grievance whatever about this—did not mention this clause, or indeed any other clause. He gave a short exposition of the whole Bill. I spoke on the Second Reading and asked that this clause should not become part of the Bill. In replying to the Second Reading debate the noble Lord, Lord Kennet, did not explain positively why the clause had been introduced and said that this would be tackled later, by which I assume he meant the Committee stage. I am only sorry that it comes up so late and in such a thin Committee. He did, however, say that when a Government introduce an amendment to the law—and I quote him they do not do so on the basis of any judgment whether or not the decision of a court on the law as it stands before that moment is correct or incorrect."—[Official Report, 8/7/69, col. 1017.] In those circumstances, I feel bound to explain to the Committee from the words of Ministers in another place why the clause was in fact introduced. In the first place, the clause was moved only on the Report stage by the right honourable gentleman the Secretary of State for Wales in these short and clear words: It is really a corrective clause which will be welcomed by 1 million householders in the country, for it removes the misunderstanding which has existed ever since the Custin's decision by the Lands Tribunal, where it appeared that the Tribunal had taken into account in assessing the price of the freehold, the fact that market value must be shared between the ground landlord and the tenant. He concluded by saying: We now take the tenant, the leaseholder, out of the market; he is not to be considered to be a bidder in the open market, and I believe that the sooner that this gets to the Statute Book the better. One of the many curious backgrounds of this Clause is that the Amendment does not do what the Secretary of State for Wales asked to be done. It does not, in its powers, have anything to do with altering the sharing of the market value between the ground landlord and the tenant. If that was intended, a gross mistake has been made because the Amendment does not even try to do it. Therefore, the reason given by the Secretary of State will not apply if this Clause is passed.

The Parliamentary" Secretary spoke again in another place and explained more fully what was intended by this Amendment. I ought to say that the Custin's case is named after the tenant, Mr. Custin. It was a case before the Lands Tribunal to assess the amount to be paid by the tenant for obtaining the freehold, and it seems pretty clear to me that the clause was, to use the Secretary of State's own words, "a corrective clause", because a decision by a court had been made which the Government considered was a wrong decision. So far I think your Lordships will agree with my submission that Lord Kennet's idea that the clause was not on the basis of a judgment cannot be readily accepted.

At the end of the Report stage the Joint Parliamentary Secretary used these words—I apologise for quoting them rather lengthily, but I found no way whereby I could quote more shortly without risking being told that I had mis-reported: What Parliament can do, as any Government can, is to frame its legislation as carefully as it can, but as I have said again and again, these valuation points are very difficult and the courts or the Tribunal must be left to interpret them. I wish that had been done. The courts have interpreted them, and the Government have moved to intervene to "dis- interpret", if there is such a word, by an Amendment. If the matter had gone elsewhere by which I think he must have meant "to appeal", there might have been a different decision. It was by no means certain, and it could not have been certain after the arguments, that the Tribunal would come to whichever decision. Finally he said he was surprised that that decision had been made. He said that it breached paragraph 12 of the White Paper, on which the Act was framed, in these words: … the fair price enfranchisement will be the value of the freehold interest of the site … This will completely "— and the Minister repeated the word— completely disregard the value of the buildings on reversion. The Parliamentary Secretary ended his speech by saying: Faced with this situation the Government have introduced the new clause. I hope I have not omitted words that I should have quoted, but I think I have given the sense.

It is beyond argument from this quotation that the Amendment has come from the decision of a court of law, the Lands Tribunal, because the Government thought that that decision was a breach of the White Paper which it introduced before the Act, and that if the tenant was to bid he must be bidding for the bricks and mortar which belonged to him. There is no clearer statement than that, that that was being said. It was not being said by this Minister that it was anything to do with merger value; it was to do with bricks and mortar value, which are absolutely and completely different things. The court made no attempt to value bricks and mortar; they did value the merger value, and I shall show your Lordships exactly what they have said in a moment.

What they did was to say that the tenant was a bidder, and somebody has considered that because the tenant was a bidder it means that bricks and mortar value must come into it. That is, with all due respect to everybody concerned with this, a complete misapprehension. Site values are valued day in and day out in all sorts of ways—for taxation, rating and various matters. The valuation of the site and the valuation of the buildings are perfectly easy things to understand for anyone who works in practice, and the court was valuing the site value. What they have said is that the tenant's bid is to be considered in valuing the site value. If there are more bidders for anything—site value, bricks and mortar, whatever it may be—it may very well affect the value of what you are valuing, but it cannot affect the value of anything you are not valuing. I dare say that in a lot of these cases the presence of the tenant will put up the site value, but there is a tremendous misconception about this. It has nothing whatever to do with building value, and I cannot myself find out why this Amendment has been put down, and who has done wrong.

Lord KENNET

For the sake of clarity, I think it would assist the Committee if the noble Lord were to say what he means by "this Amendment". The noble Lord has said that he cannot make out why this Amendment was put down. What is before the Committee is a proposal by the noble Lord to leave out Clause 80.

Lord SILSOE

I spoke inaccurately. I am speaking on whether this clause should stand part of the Bill. I am sorry I mentioned the word "Amendment "; I should have said "this clause". When I spoke on Second Reading I was able to speak only from my own experience in this matter, but since the Second Reading the institutions of chartered surveyors—there are three in number—have written a paper on this question and on this clause and they have sent a copy to every Member of your Lordships' House who spoke on Second Reading, including myself and, I know, the noble Lord, Lord Kennet. They said this: It is understood that this provision arises as a result of the Custin's decision. In this case, the Lands Tribunal, in arriving at the valuation of the freehold interest under the provisions of Section 9 … took into account the higher price that the tenant would pay for the advantage of merging the freehold and leasehold interests. It has now been suggested that the valuation of this merger included some part of the valuation of the bricks and mortar, thus conflicting with the principle of the Leasehold Reform Act that the land should be considered as belonging to the freeholder and the building to the leaseholder. The Chartered Land Societies Committee, which represents all Chartered valuers in England and Wales docs not accept that the valuation of any part of the bricks and mortar was included, as the figures used by the Lands Tribunal relate to the valuation of the site only, and in any case only part of the merger valuation was attributed to the freehold interest. It is perhaps not directly relevant to this clause, but at the end of their report the Committee say this: The Committee also considers that there are a number of defects in the Leasehold Reform Act which require study and that amendments should not be made pie: emeal by way of insertions into other Acts which are not apposite. There is the clearest possible professional opinion on what the Ministers m another place said had not happened. I ventured to say it on my own authority on Second Reading, and I now have the very strong support of the professional opinion of all surveyors.

But there is another, much more compelling, reason why I think this clause should not stand part of the Bill. In their judgment, which fortunately is in writing—and it has been published verbatim widely throughout the profession in this country—they said this: In our view the expression 'willing seller' means no more than that the vendor cannot expect more than the market price on a sale on the statutory terms because he might be thought to be selling with reluctance; but there is no reason why he should sell below the market price. We then come to the very fundamental wording of the Lands Tribunal. I should like to pay a tribute to the Lands Tribunal which I am sure the noble Lord will second. The Lands Tribunal is now used by every Government with complete confidence and matters of this sot are always referred to them. This is what they said on this case: We note that Section 1 (1) of the Leasehold Reform Act 1967 requires that the acquisition should be ' on fair terms.'"— Those are words in that section— and we do not think that the exclusion of the tenant would result in a 'fair term; ' sale because a price which was calculated on a basis which ignored the price which a tenant would be prepared to pay would not be on 'fair terms'. We have therefore come to the conclusion"— Please note the word "therefore"— that the sitting tenant should not be excluded from the market. This is precisely and unambiguously the wording of this new clause. It is therefore quite clear that in spite of a finding of law and fact by this admirable Tribunal, the Lands Tribunal, the Government are seeking by this clause to put in words which will, in the view of the Lands Tribunal, not be fair when it is passed. These, in fact, were the final words of the judgment on the point of law.

Where do we find, as the Parliamentary Secretary in another place stated, that this Tribunal was in any form of doubt? He said that they were very doubtful about this. Well, some of us have been at the Bar and some of us have done law and we know that judges are particularly kind to people whose arguments they are going to destroy. They were very courteous to the losing counsel. They said he had a formidable argument; but really the judgment was never more clear.

Three things I finish with. Whatever this clause does, it does not in any way at all alter the merger value, the very reason, the only reason, given by the Secretary of State for Wales. It also only alters the number of bidders by excluding the tenant on site value. I agree that it may alter the value of the site value in so doing; but it will not affect the bricks and mortar. Lastly, it deliberately—and none of this was mentioned in another place—it deliberately goes against the views of this eminent Tribunal in saying that the terms will still be fair when this Amendment is passed. For all those reasons, I hope that this clause will not stand part of the Bill.

Lord HOLFORD

I wish to say only a few sentences on Clause 80. I am a supporter of the Bill. I do not want to do anything to interrupt its passage. But in running along with it, I must say that Clause 80 seems to me like a small, rather sharp stone in my shoe. Unlike the noble Lord, Lord Silsoe, who wishes for the omission of Clause 80 from this Bill, I am not a lawyer and I am not a valuer. But the things in which I am interested—the planning, the layout, the construction of new buildings or the improvement of an old house—all these practical, constructive things, cannot start until the valuers and lawyers have arrived at a fair determination and the client receives. What worries me about this is whether in fact the terms are fair. Again I must repeat that I am not a lawyer, and I do not know whether the terms are fair. Reading Custin's case, it seems to me that they are not. But there is certainly doubt whether the terms are fair under this clause, and one is bound to ask, therefore, why this Clause is included in the Bill. We have here a very nice portmanteau, with a great many subdivisions closely packed in a very complex Bill; and then there is this additional clause, this uncertainty which is squeezed into it; and it seems to me, as an inexpert, that it looks as if it might break the lock.

9.51 p.m.

Lord MAELOR

I beg the noble Lord, Lord Silsoe, not to carry his Amendment to a Division because this Clause is vital to leaseholders and clarifies the position following the first two cases heard by the Lands Tribunal. However, in the latest case, decided only yesterday, another point arose; whether or not the ground landlord can use the so-called inflationary method of valuation. During discussion on this Clause in another place Mr. Arthur Skeffington, the Parliamentary Secretary to the Ministry of Housing and Local Government, used these words: In the Custin case"— the first case to go to the Tribunal— the Tribunal was firm in its opinion that most valuers agreed that it was impossible to make calculations which would take account of the value of money for 30 or 40 years ahead. Notice what Mr. Skeffington said; that in Custin's case the Tribunal was "firm". It did not appear to be quite so firm yesterday when it came to its decision, because it did not rule against this principle of the inflationary method of deciding the value. Will the Minister confirm (I hope that he will do so to-night) that this method is not valid; and will he look at the position in case we have to clarify it by a further Amendment? I believe that we shall then gain real social justice for the thousands of leaseholders we have in Wales. On the last occasion when I spoke in your Lordships' Chamber I called this system "a damnable system", and I repeat that it is a really damnable system. We in Wales have been suffering from it for years and years, and I see some hope, through this and the other clauses, of some redress after all the suffering which we have experienced throughout those years.

Lord HELSBY

It seems clear on the face of it that this Clause is the "odd man out" in the Bill. It does not really belong in a Housing Bill; it is in a sense an Amendment to the Leasehold Reform Act. It appears to be based on the belief that a certain finding of the Lands Tribunal should be altered. Now we are told by the noble Lord, Lord Maelor, that the Lands Tribunal has given another judgment in a somewhat different sense only yesterday. I cannot pretend that I have absorbed the meaning of that; indeed I have not seen the judgment of yesterday. But what does seem to stand out is that a market is a market. If we talk about a willing seller and a willing buyer, we are talking about a free market; and surely a free market means that we must not by law disregard a bid from anybody who would wish to bid. There is nothing artificial about that; there is nothing, I think, that the ordinary layman, as well as the lawyer, could fail to understand. The only reason for excluding the tenant on the lines of the Custin decision appears to have been that it was thought in some quarters that the Lands Tribunal had taken into account the bricks and mortar value; but we have good authority for believing that whatever else it may have done, it did not do that. What the Tribunal did believe was that a free market is a free market, and that the tenant, when he puts in a bid, has as much right to be considered part of the market as anybody else. Surely that should be a clear case for us to take into account.

9.55 p.m.

Lord KENNET

The Committee will have listened with the greatest attention to the noble Lord, Lord Silsoe, because, as we all know, he is a very great expert in all matters of valuation and property. I know that it was only an oversight on his part that neither on this occasion nor on Second Reading did he mention his own interest in the matter at stake, as the leader of one of the greatest freeholders granting leases in the country.

Lord SILSOE

May I ask for leave? I have not stated my interest because I retired last week. So far as I know, I own nothing, either privately or publicly in the world.

Lord KENNET

I must apologise to the noble Lord for being out of date. Of course the Second Reading was last week.

Lord SILSOE

I declared my interest two years ago, very fully. Now I have No interest, and I should like everybody to know. Unfortunately I have retired and am no longer earning money.

Lord KENNET

The Committee will be glad to learn the precise details of the noble Lord's interest. The noble Lord is the greatest expert in the world about valuation but I honestly do not think he knows what Parliament is for. Parliament is not for deciding if this or that decision by a court or tribunal is right or wrong. It is for changing the law. All the Government are doing is saying to Parliament: We do not think the present law is right, and the main reason why we do not think the present law is right is because of what happened in Custin's case (which was quite surprising). We therefore propose to change it. Do you agree? It is on that basis that I shall continue.

All I am saying is that the Government think Parliament ought to change the law. I absolutely decline to be drawn into any discussion of the rectitude or the ability or the appositeness of that decision by the Lands Tribunal or by any other court. The courts' job is to say what the law is. The Government's job is to propose, from time to time, changes in the existing law which it thinks will improve it, and that is what I am doing.

There are two or three things which I will state very simply which seem to be quite clear. First of all we have ample evidence that since the decision in Custin's case a great many freeholders have been asking more than they had been, or they were proving more reluctant to come to terms with their enfranchising leaseholders. This is no theory; this is the fact, and I think there is a casual relation. The second thing is that the Lands Tribunal themselves did, whatever the noble Lord says, think the Act less than clear about whether the open market referred to in Section 9 was supposed to include or to exclude the tenant, although they decided—and the Government are not disagreeing with them in their interpretation of the existing law—that the Act included the tenant.

The third thing is that the Government's decision to recommend Parliament to make it clear for the future that the tenant is to be excluded in recommending a change for the purpose of determining price was warmly welcomed by both Parties in another place and I myself am most anxious to hear what the noble Lord, Lord Brooke, is going to say about this, if indeed he is going to speak, because the Opposition in the House of Commons did not oppose Clause 80 when it was taken into the Bill, and indeed, they joined with Government spokesmen in an attempt to improve the clause. As a matter of fact, the main criticism that was brought against it by Opposition spokesmen—I may not quote Mr. Rossi—was that it would be wrong to congratulate the Government on bringing this Clause in because they had brought it in much too late and ought to have brought it in a long time ago. They did not say that it should not pass and, indeed, they did not oppose its adoption.

There is no likelihood that I should persuade the noble Lord, Lord Silsoe, that this is a good clause. On Second Reading he quoted the Lands Tribunal as saying that a price which ignored the price which a tenant was prepared to pay would not be on fair terms and he called this a finding of fact by the law. I do not dissent that it is a finding in law. The Government are now asking Parliament to change that law. What I pay great attention to is the fact that the noble Lord said that the Amendment would not have the effect desired. Coming from him, these are words to which we must pay the greatest attention. The intention of the Amendment is that when the sum to be paid by the leaseholder is being determined on enfranchisement it shall be determined as though those bidding in the open market for the freehold interest did not include the leaseholder, because he would be prepared to go higher than the run of the market because of his superior interest in marrying the freehold and leasehold together. The noble Lord said that the Amendment is not going to achieve that but did not say why. I am extremely worried.

Lord SILSOE

So far, I am in complete agreement with the noble Lord. I did not say that. Of course, the Amendment would not allow the bidder to be considered. What I said was that the Amendment would have no effect what- ever either on the merger value or on the bricks and mortar value. That is all I said; and I still say it. I agree that the Amendment is perfectly clear and that nobody in valuing the site value would in future be allowed to consider the bid of the tenant.

Lord KENNET

I take the noble Lord's point. It is a philosophical one. The noble Lord maintains that real values are there whatever Parliament says about them. The only purpose the Government seek to achieve is to establish the actual value, but I must agree with him philosophically that we may imagine a ghost value existing under legislation. In another place, the Opposition spokesmen, so far from resisting the clause, suggested an Amendment—an improvement of it, in my view—to extend the provision that not only the tenant should be excluded from the market but also the tenant's family. If this clause remains in the Bill, I shall be moving an Amendment which will meet the point raised by Opposition in another place about the desirability of extending the operations of the clause. We must not go into valuation philosophy here. Parliament is here to make the law. I think that Clause 80 will improve the existing law in a perfectly concrete social way, and I hope that the Committee will agree to let it stand and will join me in improving it as regards the tenant's family.

10.4 p.m.

Lord BROOKE of CUMNOR

I am neither a lawyer nor a valuer, thank Heaven! (perhaps I ought not to say that and I apologise to noble Lords who are), but I approach this as a plain man. I have been thinking hard about this since the debate started and it seems to me that the noble Lord, Lord Kennet, has left himself wide open by the manner in which he has defended this clause. He has said that the noble Lord, Lord Silsoe, does not understand Parliament; that Parliament is here to make or to change the law; that Parliament is supreme and can do what it wishes. What Parliament cannot do—

Lord SILSOE

I must now interrupt the noble Lord. I did not say that Parliament could do what it wished. I said that Parliament was there to change the law.

Lord BROOKE of CUMNOR

Parliament was there to change the law. As nobody else can change the law, Parliament is presumably supreme. But Parliament cannot be inconsistent with itself. What has become absolutely clear to me, listening to the noble Lord, Lord Kennet—it may not have been clear to my colleagues in another place—is that the Government here are asking Parliament to deny one or' its own statements. I think that this finding by the Lands Tribunal is conclusive on that—conclusive unless it is reversed on appeal—because although Parliament can change the law it cannot delete what the courts or bodies like the Lands Tribunal say.

In this judgment by the Lands Tribunal which the noble Lord, Lord Silsoe, has quoted, the Lands Tribunal said: Section 1 (1) of the Leasehold Reform Act requires that acquisition should be on fair terms, and we do not think that the exclusion of the tenant would result in a 'fair terms' sale because a price which was calculated on a basis which ignored the price that a tenant would be prepared to pay would not be on fair terms. That is the final conclusion of the highest legal authority to which this matter has been submitted. It could have gone to appeal, but the Government decided to legislate before there was opportunity, to hear what might be said or found on appeal.

What is clear now from the noble Lord's speech is that the Government are proposing to amend this Act of 1967 (which says in its first Section that acquisition is to be on fair terms) in such a way that the acquisition will not be on fair terms. That is to say, the Government are asking Parliament to contradict itself. This is something which no Government can do. You cannot have in Clause 1 of the Bill that something must take place on fair terms, and a provision subsequently inserted into the Bill designed to ensure that the acquisition shall take place on terms which have been found by a judicial authority to be unfair terms. That is the simple issue here, and if the noble Lord decides to press this Amendment I shall certainly support him in the Lobby. Whether he will decide to press this Amendment in this very thin House this evening I do not know. The amount of support he has received from the Cross-Benches on this matter is impressive. This is not an Opposition Amendment; all the running has been made by the Cross-Benches who hare no Party interest in it.

I have been arguing not on grounds of Party philosophy but on plain grounds: that Parliament must not contradict itself in the course of a single Act of Parliament. I am sorry that the Committee is so thin because I do not know whether we could achieve a just result to-night if the matter were pressed. I think that either now or at some later stage your Lordships should come to a decision on this clause.

Lord KENNET

I think there is 2very advantage in coming to a decision. I do not expect that I shall convince the noble Lord, Lord Silsoe, because he is a valuer and I am a Parliamentarian, and we see the world in slightly different ways. Lord Brooke's relationship with those of his Party who in another place supported this clause which he now proposes to vote out of the Bill is something that I must leave entirely to him; but I note the confusion in the ranks of the Opposition Party. In the House of Commons they want it; in the House of Lords they do not want it. The Government want it in both Houses, and I hope that the Government will be able to retain it if the noble Lord, Lord Silsoe, forces the matter to a Division at this late hour.

Lord SILSOE

I have tried to be a Parliamentarian, but I admit that I have not much skill. I am certainly not a Party politician. I try to understand matters. I understand that the Government of the day—or, indeed, a private individual—can bring into Parliament a change of the law. We have not had any reason given, save one that was given in another place, and that has been contradicted. It is now denied that this idea of moving this clause stems from a decision in the courts being wrong. That was the reason, and the only reason, given in another place. But those of your Lordships who have followed the noble Lord carefully will not remember a single reason why this change of the law is recommended.

I hope I am right in saying that it is normal to give a view when the same Government are amending a law, and when it is something that they themselves introduced only two years ago, I should have thought there was all the more reason for saying why there has to be a change. I am afraid that in these circumstances I look very much to those who sit on the Government Benches—I hope they will not mind my being impertinent. A mistake has been made. This clause should not have been brought up, at any rate in this form, because, so far as I can make out, it is not going to do what the Government desire. In those circumstances, one would have thought that something would have been offered

Resolved in the negative, and Clause 80 disagreed to accordingly.

which would have enabled me to say that we could think about it again and possibly return to it at a later stage. But nothing has come up. I have been encouraged by the noble Lord, Lord Kennet, to go to a Division, and, with due respect to your Lordships, that is what I wish to do.

10.12 p.m.

On Question, Whether Clause 80 shall stand part of the Bill?

Their Lordships divided: Contents, 22; Not-Contents, 23.

CONTENTS
Addison, V.	Heycock, L.	Serota, Bs.
Beswick, L.	Hilton of Upton, L. [Teller.]	Shackleton. L. (L. Privy Seal.)
Bowles, L.	Hughes, L.	Shepherd, L.
Brockway, L.	Kennet, L.	Stonham, L.
Campbell of Eskan, L.	Llewelyn-Davies of Hastoe, Bs. [Teller.]	Strabolgi, L.
Champion, L.		Taylor of Mansfield, L.
Gardiner, L. (L. Chancellor.)	Maelor, L.	Wilson of Langside, L.
Goodman, L.	Ritchie-Calder, L.

NOT-CONTENTS
Airedale, L.	Conesford, L.	Monson, L.
Balerno, L.	Cork and Orrery, E.	Mowbray and Stourton, L.
Belstead, L.	Denham, L.	Netherthorpe, L.
Boston, L.	Falkland, V.	Sandford, L.
Brooke of Cumnor, L.	Falmouth, V.	Selkirk, E.
Brooke of Ystradfellte, Bs.	Gridley, L.	Silsoe, L. [Teller.]
Carnock, L.	Helsby, L. [Teller.]	Strathcarron, L.
Clifford of Chudleigh, L.	Holford, L.

10.21 p.m.

Lord KENNET moved Amendment No. 45: After Clause 80 insert the following new Clause:

Amendment of Rent Act 1968 s. 46

". At the end of section 46 of the Rent Act 1968 (determination of fair rent) there shall he added the following subsection:

'(4) In this section "improvement" includes the replacement of any fixture or fitting.'"

The noble Lord said: This Amendment follows up what I said on Second Reading about bringing this Bill into line with the Scottish Bill as regards whether or not tenants' replacements of things in houses should count for the determination of a fair rent under the regulated tenancy. I beg to move.

On Question, Amendment agreed to.

Clauses 81 and 82 agreed to.

Clause 83 [Interpretation]:

Lord KENNET moved Amendment No. 46: Page 48. line 32, leave out from ("capacity") to end of line 34.

The noble Lord said: There is a restriction in the Bill as drafted that the cost of works carried out by housing authorities for works for improvement and standard contributions and for contributions towards environmental improvements, cannot include the salaries for private authorities taking part in this, employed in an advisory or supervisory capacity. The Amendment removes that restriction so that they can be. I beg to move.

On Question, Amendment agreed to.

Clause 83, as amended, agreed to.

Clauses 84 to 87 agreed to.

Clause 88 [Citation, construction, commencement and extent]:

Lord KENNET rose to move Amendment No. 47. The noble Lord said: Since Clause 80 has been lost, this Amendment will have to refer to Sections 78 and 79 instead of to Sections 78 to 80. Therefore, with the leave of the Committee and the approval of the Lord Chairman, I will move the Amendment so that it reads Page 50, line 1, leave out from ("Act") to first ("the") and insert ("except Sections 78 and 79, shall not come into force until"). Most of this Bill the Government would wish to bring into force one month after it received the Royal Assent, which is the usual procedure. It gives time for things to be drafted and for everything to be lined up, but there are certain provisions in Clauses 78 and 79 where there is nothing to be prepared and where the market in certain types of transaction is frozen, awaiting these provisions in the Bill. Therefore, it seems to the Government that nothing would be lost and much convenience would be gained if Clauses 78 and 79 were to come into effect immediately instead of waiting for the usual period of a month. I beg to move.

Amendment moved— Page 50, line 1, leave out from ("Act") to first ("the") and insert ("except sections 78 and 79, shall not come into force until").—(Lord Kennet.)

On Question, Amendment agreed to.

Lord KENNET

Amendment No. 48 is consequential on Amendment No. 36. I beg to move Amendment No. 48.

Amendment moved— Page 50, line 4, after ("section 77") insert ("and section (Right to terminate period for which option notice has effect)").—Lord Kennet.)

On Question, Amendment agreed to.

Clause 88, as amended, agreed to.

Schedule 8 [Minor and consequential Amendments]:

Lord KENNET

Amendment No. 48 rectifies an omission. I beg to move.

Amendment moved— Page 66, line 18, leave out ("and 16") and insert ("16 and 21 (1)").—(Lord Kennet.)

On Question, Amendment agreed to.

Lord KENNET

Amendment No. 51 is a drafting Amendment for the sake of clarity. I beg to move.

Amendment moved— Page 67, line 15, leave out ("Sections 98,") and insert ("Section 98 of that Act shall apply as if the reference therein to a purchase under Part V of that Act of a house to be used for housing purposes included a reference to a purchase under Part II of this Act of any house.

Sections")—(Lord Kennet.)

On Question, Amendment agreed to.

Lord KENNET

Amendment No. 52 is consequential upon Amendments carried in the House of Commons. I beg to move.

Amendment moved—

Page 68, line 18, at end insert— (". In section 57 (4) of that Act for the words from 'section 4' to '1958' there shall be substituted the words 'Part I of the Housing Act 1969'").—(Lord Kennet.)

On Question, Amendment agreed to.

Lord KENNET

Section 14 of the Housing Subsidies Act 1967 empowers the Minister to reduce, suspend or discontinue the payment of annual subsidies in certain circumstances. One of those circumstances is where the Minister "is satisfied that a local authority have failed to discharge any of their duties under the Housing Acts 1957 to 1965". This Amendment will bring the composite reference to the Housing Acts up to date by referring to the Housing Acts 1957 to 1969. I beg to move.

Amendment moved— Page 68, line 34, at end insert—

("The Housing Subsidies Act 1967

In section 14 (5) (a) of the Housing Subsidies Act 1967 for the word '1965' there shall be substituted the word '1969'.")—(Lord Kennet.)

On Question, Amendment agreed to.

Schedule 8, as amended, agreed to.

Schedule 9 [Savings and transitional provisions]:

Lord KENNET

Amendment No. 54 is a drafting Amendment. I beg to move.

Amendment moved— Page 69, line 5, after ("application") insert ("or arrangements made or proposals").—(Lord Kennet.)

On Question, Amendment agreed to.

Schedule 9, as amended, agreed to.

Schedule 10 [Repeals]:

Lord KENNET

The Amendment repeals from the Housing Act 1957 a reference to a subsection of that Act which is already repealed by this Bill. It is tidying up. I beg to move.

Amendment moved— Page 70, leave out line 10 and insert ("In section 59, subsection (3) and the word 'or (3)' in subsection (4)").—(Lord Kennet.)

On Question, Amendment agreed to.

Lord KENNET

Amendment 56 is a drafting Amendment. I beg to move.

Amendment moved— Page 71, leave out lines 24 to 26.—(Lord Kennet.)

On Question, Amendment agreed to.

Schedule 10, as amended, agreed to.

In the Title:

Lord AIREDALE moved Amendment No. 57: Line 3, after ("dwellings") insert ("and houses").

The noble Lord said: Line 4 of the Long Title refers to "improving dwellings and houses". Line 3, where I seek to insert this Amendment, refers to "providing dwellings by conversion". I seek to insert the word "houses" there so as to make it read "providing dwellings and houses by conversion". There is no doubt that the conversion of a large barn may provide a large house, and if the word "dwelling" does not automatically include the word "house", as presumably it does not because they are both referred to separately in line 4, then I should have thought it better that they were separately referred to in line 3, so as to leave no doubt that in line 3 the provision of a house by the conversion of quite a large building is covered by the Bill. I beg to move.

Lord KENNET

Only the term "dwelling" is used in Part I of the Bill in relation to improvement grants for conversions, and so to carry the word "houses" into the Long Title would be inappropriate because it would not reflect what is in the Bill. The term "dwelling" is not defined in the Bill, but an ordinary house provided by the conversion of, for example, a building such as a barn, would qualify for improvement grant aid under Part I as being a dwelling provided by the conversion of a building. I hope that may satisfy the noble Lord.

Lord AIREDALE

Well, I do not understand what is the need for using the expression "dwellings and houses" in line 4 if "dwellings" alone is sufficient in line 3. I think I had better read in Hansard what the noble Lord has said, and see if I can understand and accept it, and whether or not I ought to move an Amendment at the next stage of the Bill. In the meantime, I beg leave to withdraw this one.

Amendment, by leave, withdrawn.

Lord KENNET

Amendment No. 58 is consequential on Amendment No. 36. I beg to move.

Amendment moved— Line 19. leave out ("section 28") and insert ("Part II"—(Lord Kennet.)

On Question, Amendment agreed to.

Lord KENNET

I always like to say what consequentials are consequential on, for the benefit of posterity and students. This Amendment is consequential on Amendments Nos. 33 and 45. I beg to move.

Amendment moved— Line 20, after ("1967") insert ("to amend section 46 of the Rent Act 1968; to increase the fine which may be imposed under section 170 of the Housing Act 1957")—(Lord Kennet.

On Question, Amendment agreed to.

On Question, Whether the Title, as amended, shall stand part of the Bill?

Lord CONESFORD

I only wish to ask the Parliamentary Secretary: Does the Title require an Amendment as a result of the last Division?

Lord KENNET

I do not know. It may require one. I shall have a look at it and, if so, raise the matter on the next occasion.

Title, as amended, agreed to.

House resumed: Bill reported, with the Amendments.