Lords Sitting of 24 January 1983

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Derby.

Land: Vacant and Under-used Acreage
Lord Gainford: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government how many acres currently recorded on the local authority registers of vacant and under-utilised land for England are in local authority possession.
Lord Skelmersdale: My Lords, the six-monthly returns for the end of December are currently being analysed, but at the count on 1st July last, local authorities owned 61,000 acres, nearly two-thirds of the total of all publicly owned land on the registers.
Lord Gainford: My Lords, I thank my noble friend for his Answer. May I ask him whether he is able to say if Her Majesty's Government can give any direction to these councils to make use of this land rather than to frustrate possible housing development?
Lord Skelmersdale: My Lords, if I may correct my noble friend on one point, not all of this land is in the remit of the councils. Quite a lot of other public land is included. So far as directions are concerned, my right honourable friend is actively considering this matter in respect of a number of sites on the registers. The procedure would be to invite the owning public body to state whether there is any reason why a
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direction should not be given and, in the light of its reply, to consider what action to take.
Baroness Birk: My Lords, is it not a fact that much of this land remains vacant or under-used because of the cutbacks in the rate support grant and the capital control restrictions which were introduced by the Local Government Act 1980? Is it not also true that the Government are, perhaps unintentionally but nevertheless actually, adding land to these registers every week as firms close down, largely due to Government policy?
Lord Skelmersdale: My Lords, so far as the last point is concerned. I should have thought that the land in question there would be privately owned. I agree, however, that there are advance sites, factory sites, for which local councils and others would have the responsibility. So far as the capital allocation, and so on, goes with the rate support grant, or the GRE as I understand it is now called, my understanding is that there is a capital underspend by councils. I do not believe, therefore, that this can be a reason. However, I agree with the noble Baroness that there may be good reasons why some sites should be retained and put to use in the public sector. Naturally, the Secretary of State cannot properly make directions without considering the merits of each case.
Baroness Fisher of Rednal: My Lords, could the noble Lord give any advice to local authorities in the West Midlands area in particular, where large industrial establishments have been completely closed down, which has resulted in acres of dereliction? Can the Minister give any encouragement to local authorities about what they are to do with that land?
Lord Skelmersdale: My Lords, as a general tenet, I should think that if they are able to use that land they should use it. If not, they should allow somebody else to make use of it. However, as I have already said, my right honourable friend cannot do anything without considering each case on its merits. If the noble Baroness has in mind any particular area of land to which she would like to draw my attention, naturally

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I shall do what I can in that case to give her the advice which she seeks.
Baroness Fisher of Rednal: My Lords, may I ask the noble Minister to tour the West Midlands area and see these derelict sites? If he could do something about getting industry on to these sites we should be only too grateful.
Lord Skelmersdale: My Lords, if that is an invitation, I shall be most grateful to accept it. However, I would point out that this has not happened during the lifetime of this Government only. Some of these sites have been derelict for very many years.

Motor Bicycles and Riders: Conspicuousness
2.41 p.m.
Baroness Macleod of Borve: My Lords, I beg leave to ask the first Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what steps are being taken to make motor bicycles and their riders more conspicuous by day and by night.
Lord Lucas of Chilworth: My Lords, the Transport and Road Research Laboratory is still evaluating the relative merits of a number of likely ways of improving both daytime and night-time conspicuity of motor cyclists. The results of this evaluation should be available early in the summer and our conclusions will be announced at that time.
Baroness Macleod of Borve: My Lords. I thank my noble friend for his Answer. May I be the first to congratulate him on a very well deserved and, if I may say so, popular elevation to the Front Bench and wish him well? Having said that, may I say how unhappy I am—rather, may I ask him to accept that I am very unhappy about his Answer, because the Government have been looking for some time at this particularly difficult problem? Does my noble friend know that in the August issue of Magistrate, a copy of which I have in my hand, it is said that one out of four deaths among males between the ages of 15 and 19 is due to motor cycle accidents? Would my noble friend agree that that is a very high figure? Could I therefore ask him to do something about this particular problem with the utmost urgency?
Lord Lucas of Chilworth: My Lords, I thank my noble friend for her very kind remarks. I am quite sure that her unhappiness is not associated with them. The noble Baroness will probably remember, as indeed the House will remember, that in 1980 the Transport and Road Research Laboratory produced a report which was found to be not acceptable by a majority of people. Further studies were therefore undertaken. A very great degree of seriousness and speed is involved. which is why these other reports and investigations will be completed later this year. I am happy to be able to tell the noble Baroness that the 1981 figures for motor
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cycle deaths and serious injuries are marginally lower than those for 1980.
Viscount Hanworth: My Lords, surely the noble Lord, Lord Lucas of Chilworth, will agree that no research is necessary to show that the use of headlights on a motor cycle in daylight is beneficial; and that instead of waiting until the end of this year we should get on with some legislation that would make that compulsory now?
Lord Lucas of Chilworth: My Lords, the noble Viscount is not correct in his assertion that there is total acceptance of the use of headlights being an aid. In fact it can be a disadvantage. The series of tests which is now being undertaken is to determine the effectiveness of motor cycles using headlights both by day and in inclement weather.
Lord Underhill: My Lords, may I also congratulate the noble Lord, Lord Lucas of Chilworth, upon his promotion to the Government Front Bench? We wish him well—but not too well! May I say also that we welcome the research being carried out by the Road Research Laboratory but urge that it should not research only into the conspicuity of motor bicycles by the use of headlights but should also examine the possibilities of fluorescent harnesses and the important question of "learner plates", which are of absolute importance to the novice, untrained motor cyclist? Will the noble Lord accept that these points are not being urged from any persecution of motor cyclists but because, despite what the noble Lord has said about there being a slight diminution in the number of accidents, the figures are so serious that action is needed in the interests of motor cyclists as well as in the interests of other road users?
Lord Lucas of Chilworth: My Lords, I thank the noble Lord, Lord Underhill, for his remarks. All deaths on the road are serious, and the Government accept this as being a very serious matter. The research and inquiries now being undertaken and made embrace all areas of conspicuity—particularly that of motor cyclists. That is one of the reasons why these inquiries may perhaps be taking rather longer than usual.
Lord Glenkinglas: My Lords, does my noble friend not agree that it is a matter not just of clothing or headlights; it is the appalling nature of motor cycle riding, such as that seen in London, which is the cause of so many accidents?
Lord Lucas of Chilworth: My Lords, I cannot totally accept that argument. It may be a contributory factor.
Lord Strathcarron: My Lords, does my noble friend not agree that a simple reflective belt and shoulder strap such as that worn by the police makes the rider very conspicuous by both day and night; and that it has the further advantage that the strap is cheap to buy and is also suitable for the safety of pedal cyclists and aged or infirm pedestrians?
Lord Lucas of Chilworth: My Lords, I thank my noble friend Lord Strathcarron for that helpful supple-

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mentary question. The Government would agree, as all sensible road users must agree, that any kind of reflective clothing and any kind of clothing which draws to one's attention the presence of a motor cyclist, pedal cyclist, pedestrian, or any other road user is most helpful. As the House will be aware, these reflective items are very inexpensive and are available quite freely from car accessory shops and also from RoSPA.
Lord Leatherland: My Lords, is it not a fact that the noise of an approaching motor cycle makes known the fact of its presence to other road users; and is it not a fact that we prosecute large numbers of motor cyclists each year for making an excessive amount of noise when using the road?
Lord Lucas of Chilworth: My Lords, I believe that the noise is probably most evident when the motor cycle has already passed. There are regulations in respect of noise levels of motor cycles, but I cannot add anything as regards the number of prosecutions of the type mentioned by the noble Lord, Lord Leatherland.

Seat Belts: Accident Statistics
2.48 p.m.
Baroness Macleod of Borve: My Lords, I beg leave to ask the second Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what steps they are taking to monitor road accidents after the wearing of seat belts is made compulsory on 31st January with a view to reporting on whether injury was or was not caused by wearing the belt.
Lord Lucas of Chilworth: My Lords, a number of studies will be made to provide information on any changes in the severity and nature of injuries sustained in road traffic accidents, including any that might be attributable to seat belt wearing.
Baroness Macleod of Borve: My Lords, while thanking my noble friend for that reply, and in view of what the Government told us during the debate we had last July—that seat belt wearing would be compulsory for only three years, and that there would be a monitoring of any deaths resulting from the wearing of seat belts or otherwise—will my noble friend undertake to insist upon a further statistic in Table 34 of Road Accidents—Great Britain which will show the numbers of those killed or seriously injured as a result of wearing seat belts?
Lord Lucas of Chilworth: My Lords, the preparations which have already been made to monitor accidents will provide information on the level of seat belt wearing, the effect on traffic fatalities and any changes in the severity or nature of injuries resulting from such road traffic accidents. It is not believed that the kind of injuries sustained in road traffic accidents can be positively set as a result of the wearing of seat belts or otherwise. Certainly whatever information comes out of the monitoring will be freely available.
Baroness Masham of Ilton: My Lords, may I ask the Minister whether one of the studies which is to be made will be on the whiplash injury resulting in people breaking their necks, and whether there is the need for head restraints? Is the noble Lord aware that not having head restraints and wearing a seat belt might be very dangerous?
Lord Lucas of Chilworth: My Lords, the Government favour voluntary installation of head restraints, but to date there is no firm information to suggest that there is at this time a case for compulsion.
Lord Underhill: My Lords, in addition to the point covered by the original Question, will arrangements be made, if at all possible, to ensure that the monitoring also gives information as to whether or not injuries were avoided or lessened because of the wearing of seat belts?
Lord Lucas of Chilworth: My Lords, certainly any of the monitoring that reveals figures will have some suggestion as to the cause and effect.
Lord Mottistone: My Lords, has my noble friend been able to assure himself in the time he has been at the department that the monitoring, when it takes place, is going to be fairly conducted in order to present a really balanced view as to whether the compulsory wearing of seat belts is necessary?
Lord Lucas of Chilworth: My Lords, in answer to my noble friend Lord Mottistone, I can tell him that I am perfectly satisfied that all relevant features with regard to an accident, whether or not seat belts are being worn, will be taken into account.
Lord Monson: My Lords, may I ask the noble Lord—whom I, too, should like to congratulate—whether the Government also intend to monitor injuries caused to motor cyclists, pedal cyclists and pedestrians as a result of car drivers being prevented by their seat belts, particularly the static seat belts fitted to older cars, from leaning forward at intersections in order to ascertain whether or not the road is clear?
Lord Lucas of Chilworth: My Lords, the accident investigation units employed on this task will certainly take all relevant facts into account.
Lord Collison: My Lords, will the noble Lord ask the people doing the survey to take into account the possible danger involved when a person is wearing a seat belt and there is a collision, not head-on but when the car is struck amidships, and the belt prevents the person from being able to swing free? Whiplash can cause accidents, and, indeed, I know of a death from that cause. I am sure the noble Lord will appreciate that I am not against the use of seat belts; in fact, I voted for them. But I think a statistic of that kind, showing how many accidents involve these side-on collisions, would be useful and informative.
Lord Lucas of Chilworth: My Lords, I have to tell the noble Lord, Lord Collison, that lateral accidents are, of course, of extreme danger. The effects they may

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have relative to the wearing or non-wearing of seat belts are continually being investigated. But there is little doubt in the figures presented to your Lordships by the Government and, indeed, by a number of Members of your Lordships' House during last summer, that the wearing of seat belts will tend to reduce the severity of any accident, whether frontal or lateral.
Lord Derwent: My Lords, is not my noble friend's baptism of fire somewhat excessive and therefore hard-hearted?

The South African Embassy: Security
Lord Hatch of Lusby: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what action they propose to take over the security risks revealed by the courts as emanating from the South African Embassy.
The Minister of State, Foreign and Commonwealth Office (Lord Belstead): My Lords, it is our longstanding policy to investigate specific allegations supported by firm evidence of unlawful or otherwise unacceptable activities by members of the staffs of foreign missions in London. Where such allegations are substantiated we shall take appropriate action. On this basis, the Government have already taken action in regard to a member of the South African Embassy's staff.
Lord Hatch of Lusby: My Lords, while thanking the Minister for that reply, may I ask him two questions? Can he tell the House whether the newspaper reports of 17th December were correct in reporting that Warrant Officer Joseph Klue of the South African Embassy was sent home on 23rd November at the request of the Foreign and Commonwealth Office, "for activities incompatible with his official status"—a euphemism for spying? If so, can the noble Lord tell the House what action—not whether any action, but what action—has been taken since? Secondly, can the noble Lord tell us whether newspaper reports in September were correct in saying that Ben Van der Klashorst, a first secretary at the embassy, left the embassy and returned to South Africa after the successful prosecution of three British arms dealers at the Old Bailey involving arms smuggling of over £1 million?
Lord Belstead: My Lords, so far as the first question is concerned, the answer is, yes; Warrant Officer Klue was withdrawn following an approach by the Foreign and Commonwealth Office to the South African Ambassador. We had good reason to believe he was engaged in activities incompatible with his official status in this country, and he will not be allowed to return. So far as the noble Lord's second question is concerned, the Government are still considering a report on that case.
Lord Elwyn-Jones: My Lords, has there been evidence of break-ins by South African agents, security or otherwise, into the premises of anti-apartheid organisations and African National Congress premises in London? Am I right in thinking that that element has been revealed in more than one criminal case in recent months?
Lord Belstead: My Lords, the noble and learned Lord may have a particular case in mind. If it is the same one that I have in mind, legal proceedings connected with that affair are still pending; therefore, the noble and learned Lord will perhaps forgive me if I do not comment further upon it.
Lord Hatch of Lusby: My Lords, can the noble Lord answer my first supplementary question: what action was taken after the Foreign Office asked for the removal of Warrant Officer Klue? Does the noble Lord not agree that these cases, which are coming up so often, reveal that based in the South African Embassy are a number of agents who are acting illegally and are collecting information? This has been substantiated by the South African Foreign Minister, Mr. Botha, who said that intelligence was gained by Warrant Officer Klue and used against the enemies of the Government. against the opposition to the Government in South Africa. Is it not clear that here is a centre of illegal activities, and can the Government not tell us clearly what action they have taken and are proposing to take?
Lord Belstead: My Lords, the answer to the noble Lord's question was given in my original Answer. A single member of the South African Embassy, Warrant Officer Klue, was withdrawn. Therefore, there was no further action that anybody needed to or could take.
As regards the assertions made by the noble Lord in the second part of his supplementary, I repeat that Britain has always made it clear that if evidence to support allegations of improper activity is produced it will be fully investigated and appropriate action will be taken. This will continue to be our approach; but that is our even-handed approach to all allegations which are made, not just those allegations concerning the South African Embassy.
Lord Brockway: My Lords, is the Minister aware that his replies have been reassuring, but nevertheless is there not an extraordinary contrast here? Let us suppose the Soviet Embassy had been guilty of these things. Imagine the reaction that there would have been in this country. Should we not show to the South African Government a determination that these actions should end?
Lord Belstead: My Lords, that is precisely what Her Majesty's Government have done; but I am at pains to make clear that Her Majesty's Government would take precisely that action whichever Government was concerned.
Lord Bellhaven and Stenton: My Lords, can my noble friend say whether South Africa poses a threat to this country, and whether it has missiles trained on our principal cities?
Lord Belstead: My Lords, I think that goes a little wide of the original Question.

The Water Industry Dispute
Lord Denham: My Lords, at a convenient moment after 3.30 p.m. this afternoon my noble friend Lord Bellwin will, with the leave of the House, repeat a Statement that is to be made in another place on the industrial situation in the water industry.
Water Bill
Brought from the Commons, read a first time and to be printed.

Mobile Homes Bill [H.L.]
3.3 p.m.
Report received.
Clause 1 [Duty to offer agreements]:
Lord Bishopstonmoved Amendment No. 1:
Page 2, line 6, after ("shall") insert ("be made without direct or indirect charge and shall").
The noble Lord said: My Lords, before I speak to this amendment it would be appropriate for me to congratulate the Minister on his elevation. It is no secret that we have not always seen eye to eye, especially on this particular measure. Now that he has been promoted, with more power as well as responsibility, I have no doubt that he will use it in order to ensure that there is greater agreement whenever the occasion warrants it.
This Bill, to which we return after two days on which Committee proceedings were held, is one of some importance. Although some noble Lords may have the impression that mobile homes are like holiday caravans and not of any great consequence, in fact they provide a not insignificant part of our permanent housing stock. The House will be aware that the department sought from the officials of the Department of the Environment a review, in June 1975, with the terms of reference to review, in consultation with interested bodies, the problems of mobile home residents and the contribution that mobile homes make towards meeting the nation's housing needs in particular, and to consider legislative provisions as they affect owners and residents, planning considerations, terms and conditions, and so on.
It was following that review that a very helpful paper containing many recommendations was published by the department. Those of us who are concerned with the legislation have been helped by all forms of interested bodies and individuals, and particularly, of course, by those who depend on a mobile home as their main place of residence. I believe that the figures suggest that about 25 per cent. of the people living in mobile homes are elderly people, and about 28 per cent. of younger people do so. So we have to recognise some of the problems and the shortcomings of the previous legislation on mobile homes.
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Many of these shortcomings have been detailed at some length in the report to which I refer, and to which the Committee referred on previous occasions. As I have said on a number of occasions, it is the task of the Opposition, and of other noble Lords, to make constructive suggestions which might be thought necessary to close some of the loopholes. This is one of the problems which some of the elderly people and the younger people in particular experienced. They are not able to go into all the legal aspects of the terms and conditions, and so on, in the making of agreements. They are subject to a fair amount of harassment, as we all recognise. There have been press campaigns and the media has drawn attention to these shortcomings.
Amendment No. 1, which refers to Clause 1, seeks to ensure that there are safeguards against the making of unjustified premium charges. We know that when people go on to a site they must have the site owner's permission and agree to a site rent and to other charges—service charges, water, electricity, amenity charges, and so on. But sometimes charges are levied mainly for making an agreement. Clause 1 requires the site owner to offer an agreement to the occupier. The amendment proposes in subsection (4) that basically the offer should be made without any charge.
Amendment No. 1 replaces Amendment No. 11 which was debated during the Committee stage and was a new clause to prevent or prohibit premiums. That amendment was defeated but we thought the matter was important enough to bring forward an alternative. The new amendment is narrower in scope but it is directed at the primary problem of site owners who charge for an agreement. The owner will still be free to sell a caravan to the occupier and to charge a pitch fee. As I said, the previous amendment was concerned with site owners requiring premiums which not only added to the cost for those wishing to use the sites on which a mobile home is placed but in some cases is a form of imposition of having to pay up on demand or else go to another site. The Minister knows, and the House must know, that the alternative sites which are sometimes suggested as a way out are not easily available because planning consent is necessary and there are not all that many sites around.
The DoE 1977 Report, to which I referred, said of the 1975 Act:
"The Act does not appear to deal with the premium payments of any kind if they are charged outside the terms of the agreement. It is not yet certain which, if any, of these additional charges are open to challenge in the courts."
As I said earlier, a range of charges can be levied by site owners on mobile home owners. Some are reasonable but others are imposed that are quite excessive. We wish to stop the making of agreements where premiums are imposed. Premiums are a form of key money which noble Lords will know is forbidden under the Rent Act 1977. I hope the mention of that Act does not give the Minister blood pressure. However, it has been augmented by the Housing Act, 1980, for which the Minister's party was responsible. Indeed, he may claim credit for that measure.
Clause 1 requires a site owner to offer an agreement to the occupier, and this amendment requires that the offer should be made without a charge being levied on the agreement. I am certain that mobile home owners

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everywhere regard it as an abuse for direct or indirect charges to be levied when an agreement is made, because they are not relevant or justified and they are being imposed merely for granting an agreement. I am referring to any sum over and above the fair market price.
The subject of the payment of premiums was debated earlier in Committee. I quote the Minister, at column 16 of the Official Report for 6th December 1982, when he said:
"Premiums are charged not as a condition of granting an agreement, but, in effect, as a condition of granting the right to station the new mobile home in the first place".
He also said:
"It is not our intention to prohibit this sort of premium".
He went on to say, at column 17 of the Official Report for 6th December:
"If the premium is excessive [the occupier] can simply go to another site. He certainly does not have to accept it".
If one considers the point I made earlier that these sites are not in abundance and there are no easy alternatives, then the mobile home owner who wants to position his home on a site is in a cleft stick. The Minister knows that there is a shortage of mobile home sites. It is not a question of going to an adjacent site down the road or even in the same village or the same county, because such sites are in very short supply. As regards other forms of housing—private and publicly owned houses—there is a choice, but there are only a limited number of mobile homes and a limited number of sites on which they can be placed. Therefore, there is really no freedom and the occupiers have to pay up if they wish to live on certain sites. Surely the Minister would agree with the principle of the amendment, and that therefore he ought to do something about it even if the wording needs to be reviewed. With those comments I beg to move Amendment No. 1 standing in my name and the names of other noble Lords.
Lord Evans of Claughton: My Lords, I should like to speak briefly in support of the amendment moved by the noble Lord, Lord Bishopston, and to explain to your Lordships that I am here in a fairly unfamiliar role for me, speaking on mobile homes, because my noble friend Lord Avebury is in India—whether or not he is inspecting mobile homes there I do not know, but I am standing in for him. I should like to join with the noble Lord, Lord Bishopston, in congratulating the noble Lord the Minister on his elevation. I had intended to write to him, but the newspapers which I received said that the noble Lord had been promoted but did not say precisely what his promotion was. I must say that I am very delighted and I am sure that it will be a great help to your Lordships' House to have the noble Lord in this new, more powerful and more influential role. I hope that our influence upon him will be the greater now that he can have the self-confidence of the higher title.
I should like to say very briefly that I support this amendment. I am sorry that the Government would not go further to prohibit premiums. If owners are allowed to make charges without, so far as I can see, any control on the amount charged, then I must say, as a solicitor, that I fear from my experience in this world
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that it will very often be used on sites where there is a shortage of caravans, as a way of increasing the profit to be made by the owner. Already he or she has sufficient ways of making a profit under the terms of the Bill, and I should have thought that this would be a reasonable limitation.
One knows, from what we have read and seen during debates on previous housing legislation, how much difficulty there is over charges—charges to do with flats and so on about which we had a number of debates in your Lordships' House. I should have thought that this was an opportunity to try to ensure that charges were not made another synonym or euphemism for an additional profit to the owner. I support the amendment.
The Minister of State, Department of the Environment (Lord Bellwin): My Lords, I should like to say "thank you" to both the noble Lord, Lord Bishopston, and the noble Lord, Lord Evans of Claughton, for their kind remarks and congratulations. I certainly take the responsibility part without question, but I am intrigued by the power that has been mentioned. I cannot say that I have noticed much of that vet, but it is early days and you never know. Certainly before I go further I should like to say that I do indeed claim credit, along with the Government, for the 1980 Housing Act.
This amendment is concerned with the same issue as one of those moved by the noble Lords, Lord Bishopston and Lord Avebury, in Committe. The amendment before us today is very much milder in tone than that proposed in Committee, which sought to make it a criminal offence to charge a premium in these circumstances. But I must say that I still cannot accept it. The arguments put forward by the noble Lord, Lord Bishopston, and indeed by the noble Lord, Lord Evans, are such that I think I ought properly to explain precisely why I take that view.
The discussion that we had in Committee on this subject was, I felt, not quite as clear as it might have been. The first point I should like to establish is the distinction between, on the one hand, a charge that a site owner might seek to make when he offers agreements to all the residential occupiers on site and to those who come on to the site in the future, as a condition of the agreement; and, on the other hand, the premium or profit that a site owner makes when he arranges for a new mobile home to come on to his site. In the second case we are talking about the profit that a site owner makes on the expenses he incurs in transporting the new home to his site, connecting it up to services such as the water supply, electricity et cetera. These profits are made separately from what may happen when the agreement itself is offered. I think that the noble Lords are seeking to prohibit both these type of charges by their amendment, but they are different and it is crucial that we should look at them separately.
The first type of charge at which this amendment is aimed is one that a site owner might seek to make as a condition of offering an agreement. It is presumably envisaged that the site owner would say to an occupier something like, "Here is a statutory agreement that I am obliged to offer you. If you want to accept it, you must pay me £1,000" or whatever the amount may be.

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The Bill does not allow a site owner to make that type of statement. It imposes an absolute duty on him to offer an agreement to all residential occupiers, present and future. There are no conditions on that offer and the occupier is completely free to accept the agreement if he chooses. If a site owner asks for an extra payment in these circumstances, then the occupier should refuse to pay it.
It could happen, I suppose, that a site owner who asked for this type of payment might withdraw his offer of an agreement if the occupier refused to pay, but in that case the site owner would have failed to fulfil the duty on him to offer an agreement and that is a critical point. The occupier could then, if necessary, go to court to enforce that duty, as he would have to do in these circumstances if this amendment were accepted. So far as that type of charge is concerned the Bill already has the effect that the noble Lords are seeking.
The Bill does not—as the amendment would—prevent a site owner from making it a term of the agreement that the occupier should pay for the administrative expenses which the owner incurs in making the offer of an agreement. It does not seem to me unreasonable that he should be able to recover these expenses provided that the charge he makes is itself reasonable. If the administrative charge is unreasonable then the occupier, of course, would be able to challenge it.
That is the position as regards charges which might be made when the agreement itself is offered. The issues that they raise are, as I have said, different from those which arise on the premium or profit which a site owner makes when he brings a new mobile home on to his site. My understanding is that it is a fairly normal practice for a prospective occupier to select the mobile home that he wishes to buy and to agree with the site owner that he should bring it on to site. This can be at an earlier stage and it is quite separate from the offer of an agreement required by the Bill. The site owner then acquires the home from the manufacturers and arranges for it to be transported to his site and connected to services. The occupier then pays a total price to the site owner, which includes an element of profit for the site owner. It is this profit which I described in Committee as an important part of a site owner's income. I made the point then that an occupier who considered that the profit which an individual site owner made was unreasonable could go elsewhere.
The noble Lord, Lord Bishopston, said that in certain parts of the country it is difficult for prospective occupiers to go elsewhere because demand outstrips supply, which I accept. But here we are talking about people who are considering whether or not to buy a mobile home. I do not think it realistic to argue that such people are likely to be forced to buy a mobile home at an extortionate price. They have an element of choice. A site owner who seeks an excessive profit is likely to find himself without any occupiers. For that reason I am unwilling to accept that this form of profit for site owners should be prohibited.
The effect of banning these profits would be either to increase the pitch fees paid by all occupiers or to drive site owners out of business. I do not think that either result is desirable. I hope that I have said enough to
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persuade the noble Lord to withdraw the amendment. In so far as it prohibits charges which are made as a condition for offering an agreement, frankly, it does not add significantly to the Bill's provisions. In so far as it goes further than the Bill in restricting a site owner's profits, for the reasons that I have given it is not acceptable.
In conclusion, I should like to repeat something which I raised many times in Committee when we were talking right across the provisions of the Bill. Throughout the Bill we seek to provide a balance between the needs of the occupiers and those of the site owners. It is the Government who have brought forward this Bill because we recognise that there are shortcomings in the 1975 Act, which, in fact, went a long way to improve the position which appertained prior to that date. We want to do this as equitably, and as fairly all round as we can. We had considerable consultations, and the Bill is the result of those consultations. Although one can always argue that one side or another is disadvantaged to a greater or lesser extent, on balance with this, as with other amendments before and now, I think that we have it just about right. I hope the noble Lord will think that that is so.
Baroness Ewart-Biggs: My Lords, I should like to say a few brief words. I am compelled to speak in this debate mainly in my capacity as an ex-diplomat's wife—and a mobile home is truly mobile in that capacity. I do not think the point that the Minister has made is absolutely satisfactory because he said that if it was wrong, meaning that if the occupier did not think it was right to pay this charge, he could refuse and go elsewhere or go to court. That must mean that the Minister thinks that these charges are wrong. Surely this particular amendment would simplify the position in that if the owner is not able to make his profit he must increase the profit he makes when selling the caravan, or he must increase the charges that he makes through his pitch fees.
Surely the noble Lord, Lord Bellwin, must agree that there is an identically parallel situation as regards flat dwellers. My noble friend has already mentioned this, but I shall repeat it because I believe it is a very important point. If it was wrong for key money to be paid for a flat or a house for a home dweller, surely we should try to protect mobile home dwellers in the same way from the power that the owner of the land has in this particular case.
Lord Bellwin: My Lords, I hasten to say that I do not accept that the circumstances are the same as those for flat dwellers—not at all. Bit if the noble Baroness is right and if the circumstances were the same. I would have to turn her argument round on her by pointing out that if one looks at the effect upon flat dwellers who wish to have accommodation one sees that although the Rent Acts have had many good effects no one can deny the bad effect which has dried up the availability of supply; and if the noble Lord, Lord Bishopston, is right—and I do not quarrel with him about this—that there are parts of the country where site accommodation is also difficult, he should be as concerned as I am that we should do nothing to make the likelihood of that less likely, if I can put it that way.

15
Therefore, I cannot accept the point that the noble Baroness makes. I would simply fall back on my last observation. We are not talking about an exact science: these are judgments; this is a point of view. In trying to get a balance, as we are in this case, it may well be that if you see the argument more in one direction than another you think that it comes down slightly on the wrong side. I think the Bill gets it about right.
Lord Bishopston: My Lords, the Minister has said that he is not yet quite sure what powers he has as a Minister of State. Having been one for five years, all I can say is that he probably has more powers than he thinks. I do not think he will have to say to us, "I shall consult on this" but, "I can actually say that I will agree to it". On this occasion I do not expect him to say that he accepts the amendment, but I should like to think that, considering the merits of what we seek to do, he will look at it again.
The noble Lord said that the occupier can go to court. That is all right, but it can take time. Many of the people we are dealing with are, as I have said, elderly; some are family people; and some are not too well aware of the legal intricacies of legislation which may or may not affect them. To go to court can also be costly. At this stage I shall not refer to Clause 5 of the Bill, which defines what is "the court". That will be raised in debate later on this afternoon. But it will certainly he very costly for people to go to court. I should have thought that legislation ought to be as helpful as possible by laying down, within reason, the details of what can or cannot be done.
Another more serious aspect of this is not only the cost but the aspects referred to in the DoE report, to which I have referred. At paragraph 3.55 the report refers to ways in which the site owner can discourage the making of an agreement which is necessary under the Bill. Having mentioned in the previous paragraph one way in which site owners can discourage occupiers from having an agreement, it goes on to say:
"This is not the only way in which some site operators have apparently sought to avoid entering into Mobile Home Act agreements. The large number of representations received by the department have left little doubt that a combination of lack of time, misunderstanding, ignorance, in some cases fear and the deliberate and often successful attempts at evasion have limited the rights that the Act sought to give. Among the pressures put on residents was a threat of increased site rents only for those who chose to enter into an agreement, exorbitant fees charged for the agreement itself and provision for additional capital sums to be paid annually by future residents to whom an agreement has been assigned".
Then the next paragraph reads:
"It is also unclear how far the Act has succeeded for those who have agreements in outlawing certain restrictive practices. The Act"—
this, of course, is the Mobile Homes Act 1975—
"does not appear to deal with premium payments of any kind although that is outside the terms of the agreement. It is not yet certain which, if any, of these charges are open to challenge by the courts—connection charges and premiums charged to tenants entering sites usually to he paid outside the terms of the agreement".
There is some doubt about this and it is not good enough to say that people can go to court to get their rights taken care of and the measure defined.
The Minister has said, again rightly, that we seek a balance between the site operators and the occupiers.
16
I agree, but he must realise that the main advantage is with the site owners. They have the sites and, due to shortage of alternative sites, if someone wants to put a mobile home on a site, the operator can say, "These are my terms."
I accept the Minister's point when he says that all this can be in the charges, but the charges should not include something for merely making the agreement. It is rather like going into a shop and buying a commodity off the shelf where the price is 20p and the shopkeeper saying, "You can have it at the price of 20p but I will charge another 5p for selling it". That is really only possible when there is a shortage of that commodity, but we do not expect that kind of thing to go on, especially when other forms of home ownership are covered by the Rent Act 1977 and the Housing Act 1980, which prohibit key money.
I hope that the Minister will look at this again, in view of the comments made by noble Lords. To give the Minister a chance to use his powers, I shall seek to withdraw the amendment at this stage.
Amendment, by leave, withdrawn.
3.33 p.m.
Lord Bishopston Lord Bishopston moved Amendment No. 2:
Page 2, line 29, at end insert—
("( ) For so long, after the expiry of the required period, as the owner fails to offer the occupier an agreement under this Act, the owner shall, notwithstanding the terms of any agreement, not be entitled to increase the amount of any payments due from the occupier.").
The noble Lord said: My Lords, this amendment also is important, indeed more important, and also seeks to clarify the Bill and close the loopholes which need closure, if the rights of the mobile home occupiers are to be safeguarded and if the site owners and operators are to be clear about their rights and responsibilities. The Bill does not impose any realistic sanction on the owner who fails to offer an agreement—I touched on this briefly when dealing with the last amendment—and the occupiers' right to apply to the courts is not sufficient. The amendment seeks to deal with the non-complying owner by effectively preventing him from increasing pitch fees or other charges as long as he is in default. We discussed this at the Committee stage and this is a variation of the amendment moved then. However, it is a little less demanding, which I think should please the Minister, but we consider it important. Because the Bill does not do so. the amendment seeks to impose an effective sanction on site owners who fail to offer an agreement. The 1975 Act provided for agreements to be made but only a percentage of occupiers made or completed agreements. so not all are covered now.
The review to which I made reference covers this in paragraph 331 and it is, I think, relevant to this situation. The paragraph says:
"Mobile home owners normally station their home on a site and occupy a pitch merely under a contractual licence. The type of contract varies considerably but the majority have no more than an oral agreement to occupy some part of a site. The DoE survey carried out mainly before the Mobile Homes Act 1975 came into operation showed that only one-third of site owners had offered written agreements to their residents and about one-quarter of residents had signed such an agreement. Half those without agreements would have liked them but even written agreements

17
rarely give the residents much security and fixed terms were the exception".
It is obvious from correspondence from various parts of the country that there is no protection where there is no agreement. This amendment seeks to provide some protection pending the making of an agreement, because without agreements there is no protection for occupiers and no satisfactory position for site owners, because neither party is aware of the legal situation, except that the site owner is as such in a much stronger position than the occupier who is afforded little or no protection or security. We shall be told that the occupier has a right, as I said earlier, to take his case to the courts to define and enforce his rights. The snag is that the occupier may be unaware of his rights or afraid to enforce them for fear of the consequences. I gave an earlier quote from the DoE report which indicated the discouragement which can be placed upon an occupier to have an agreement. The right of the occupier to go to court is not really enough safeguard, apart from the fact that few would want the trouble, or indeed the costs. The Bill should provide that a site agreement should be unenforceable for as long as no statutory agreement has been offered.
As the noble Baroness, Lady Trumpington, said at the Committee stage of the amendment we debated last time—and, of course, it is the spirit of this one—it is in keeping with Section 65 of the Consumer Credit Act 1974 in respect of improperly executed credit agreements and to get the matter sorted out by the court could be a procedure to discourage occupiers seeking justice; it could be costly and could involve someone seeking legal aid. Those were the points, which I hope I paraphrase rightly, mentioned by the noble Baroness, Lady Trumpington, last time. So the amendment aims to deal with the non-complying site owner by effectively stopping him from increasing pitch fees or other charges for so long as he is in default. The Minister has said that he wants to stop cluttering up the courts—and how much we all agree with him—but if he intends to send people to the courts to get rights for these relatively small or minor but nevertheless important legal points, he will have queues there. We are trying to help the Minister to take this matter away from the courts by putting it into the Bill and letting everyone know exactly where he stands. This is another loophole which my noble friends and I believe should be closed.
Lord Evans of Claughton: My Lords, may I from these Benches once again lend my support to this amendment moved by the noble Lord, Lord Bishopston. I think the position is that, though the overwhelming majority of landlords and site owners are fair and reasonable people, no one, on the Government Benches or elsewhere, would be so naïve as to think that all site owners and all landlords are the very essence of every possible virtue. The fact of the matter is, as the noble Lord, Lord Bishopston, has said, that the difference in bargaining strength and the difference in power between the owner and the occupier is very considerable. The owner is in a much stronger position than even the occupier with an agreement. The occupier without an agreement, reluctant as he may be to take legal advice or to think he cannot afford legal advice, and indeed, reluctant as he may be to do anything to anger the owner, might be willing to put up
18
for a very long period with a totally unprotected position as an occupier without an agreement.
The best way to concentrate the mind of the owner—the probably very rare case of the unscrupulous owner—is to prohibit him, as this clause does, for increasing the amount of payments made by the occupier until a satisfactory agreement has been entered into. I should have thought that this was a very reasonable amendment, and one that the Government might agree to accept.
Lord Bellwin: My Lords, the purpose of this amendment is to impose a penalty on a site owner who fails to offer an agreement under the Bill within the required period. The penalty would be that the owner could not increase the payments due to him from an occupier to whom he had not offered an agreement. Like the first amendment we considered a few moments ago, this one deals with a subject we discussed in Committee, and again does so in a less severe way than the earlier version.
My Lords, I argued in Committee that it would be wrong to assume that site owners would go to great lengths to avoid their obligation to offer an agreement under this Bill. An essential feature of this Bill is that it will not impose on site owners anything like the burden the Rent Acts impose on private landlords. We should not, therefore, expect that site owners will seek to avoid the obligations created by the Bill in the way that private landlords are said to avoid those of the Rent Acts. That said, I accept of course that there may be some site owners who will fail to offer agreements within the required period and that there must be protection for occupiers against them. The Bill already provides that protection. It enables an occupier to go to court to require the making of an agreement if one is not offered when it should be. I am not convinced that this amendment would take us much further.
We are told that the amendment would deter site owners from failing to offer agreements. Can we really be sure that a site owner who has ignored the obligation on him to offer an agreement under the Bill will pay any more attention to the effect of this amendment? The occupier who is not offered an agreement will still have to go to court to enforce his rights. If this amendment were to have effect, he would have to go to court to recover fees that he should not have paid. And if the problem is that the occupier did not claim his agreement because he did not know his rights, this amendment is not going to enable him to discover what those rights are.
The Bill as it stands offers a straightforward sanction for an occupier who is not offered an agreement. He can go to court or to an arbitrator to get one and on terms that the court considers just and equitable. He has the same recourse if the terms of the agreement that is offered to him are unacceptable. I do not believe that this amendment would in practice strengthen that protection, as its promoters claim. I think there is also some danger that it could be confusing. Might it not tempt an occupier who had been offered an agreement, and had neither accepted nor refused it, to claim subsequently that the offer had never been made? And might that not mean more court action rather than less? The Bill will give a solution to an occupier who is

19
genuinely not offered an agreement, and one that it would be very difficult to abuse. It is, I believe, both an appropriate and an adequate sanction for the Bill and I hope that, on reflection, the noble Lords will feel able to withdraw the amendment.
Lord Bishopston: My Lords, I am sure that we are disappointed at the Minister not being more forthcoming on this. Without an agreement there is no protection. We believe that if the making of an agreement is delayed, maybe for reasons of uncertainty, and this we are trying to correct in this Bill, or because the site operator, as I said earlier when quoting the DoE document, is not keen on an agreement being made for obvious reasons, then there is no protection for the mobile home occupier.
We debated an amendment on somewhat the same lines at the last stage, when the Committee met, and this amendment has been varied in order to make it more likely that the Minister may be forthcoming on it. If the Minister cannot give any indication that he is prepared to look at it again, then we ought to test the feeling of the House on the matter.
The Lord Chancellor: My Lords, I do not know whether I ought to put the Question now, or whether the noble Lord wants to make the Statement now and have the Division afterwards? If I do not receive any indication, I shall put the Question now.
Lord Bishopston: My Lords, I think that it would be desirable in order to complete this amendment.
3.45 p.m.
On Question, Whether the said amendment (No. 2) shall be agreed to?
Their Lordships divided: Contents, 58; Not-Contents, 103.

DIVISION NO. 1

CONTENTS

Amherst, E.

Hanworth, V.

Amulree, E.

Hatch of Lusby, L.

Ardwick, L.

Houghton of Sowerby, L.

Aylestone, L.

Jenkins of Putney, L.

Bacon, B.

John-Mackie, L.

Banks, L.

Kennet, L.

Beaumont of Whitley, L.

Kilmarnock, L.

Beswick, L.

Leatherland, L.

Birk, B.

Llewelyn-Davies of

Bishopston, L.

Hastoe, B.

Blyton, L.

Lloyd of Hampstead, L.

Briginshaw, L.

Mayhew, L.

Brockway, L.

Molloy, L.

Bruce of Donington, L.

Oram, L.

Clancarty, E.

Peart, L.

Cledwyn of Penrhos, L.

Ponsonby of

Collison, L.

Shulbrede, L. [Teller.]

Cooper of Stockton

Reilly, L.

Heath, L.

Sainsbury, L.

Derby, Bp.

Shaughnessy, L.

Diamond, L.

Stewart of Alvechurch, B.

Donaldson of Kingsbridge, L.

Stewart of Fulham, L.

Elwyn-Jones, L.

Stone, L.

Evans of Claughton, L.

Strabolgi, L.

Ewart-Biggs, B.

Taylor of Mansfield, L.

Fisher of Rednal, B.

Underhill, L.

Gaitskell, B.

Wallace of Coslany, L.

Gladwyn, L.

Wells-Pestell, L.

Grey, E.

Wigoder, L.

Hale, L.

Wootton of Abinger, B.

Hampton, L. [Teller.]

20

NOT-CONTENTS

Adeane, L.

Long, V.

Alexander of Tunis, E.

Lucas of Chilworth, L.

Ampthill, L.

Lyell, L.

Auckland, L.

McAlpine of Moffat, L.

Avon, E.

McFadzean, L.

Belhaven and Stenton, L.

Mackay of Clashfern, L.

Bellwin, L.

Macleod of Borve, B.

Beloff, L.

Marley, L.

Belstead, L.

Masham of Ilton, B.

Bessborough, E.

Merrivale, L.

Boardman, L.

Mersey, V.

Broadbridge, L.

Middleton, L.

Buckinghamshire, E.

Mottistone, L.

Campbell of Alloway, L.

Newall, L.

Campbell of Croy, L.

Nugent of Guildford, L.

Chelwood, L.

Orkney, E.

Clifford of Chudleigh, L.

Pender, L.

Clitheroe, L.

Plummer of

Cockfield, L.

Saint Marylebone, L.

Cottesloe, L.

Porritt, L.

Cullen of Ashbourne, L.

Portland, D.

Daventry, V.

Rankeillour, L.

Davidson, V.

Renton, L.

De Freyne, L.

St. Davids, V.

Denham, L. [Teller.]

St. Just, L.

Dilhorne, V.

Saint Oswald, L.

Eccles, V.

Sandford, L.

Effingham, E.

Seebohm, L.

Ellenborough, L.

Sempill, Ly.

Elliot of Harwood, B.

Skelmersdale, L.

Energlyn, L.

Stamp, L.

Faithfull, B.

Stanley of Alderley, L.

Ferrers, E.

Stodart of Leaston, L.

Fortescue, E.

Strathcarron, L.

Fraser of Kilmorack, L.

Strathclyde, L.

Gainford, L.

Strathspey, L.

Gardner of Parkes, B.

Sudeley, L.

Glanusk, L.

Swansea, L.

Glasgow, E.

Swinton, E. [Teller.]

Glenarthur, L.

Terrington, L.

Glenkinglas, L.

Thomas of Swynnerton, L.

Hailsham of

Thorneycroft, L.

Saint Marylebone, L.

Trefgarne, L.

Harmar-Nicholls, L.

Trumpington, B.

Hayter, L.

Vaizey, L.

Henley, L.

Vickers, B.

Hylton-Foster, B.

Vivian, L.

Ilchester, E.

Ward of Witley, V.

Kinloss, Ly.

Westbury, L.

Kinnaird, L.

Wise, L.

Lane-Fox, B.

Wynford, L.

Lauderdale, E.

Young, B.

Lawrence, L.

On Question, amendments agreed to.

The Water Industry Dispute
3.53 p.m.
Lord Bellwin: My Lords, with the leave of the House, I will repeat a Statement being made in another place by my right honourable friend the Secretary of State for the Environment. The Statement reads as follows:
"Mr Speaker, I wish, with permission, to make a Statement about the industrial action in the water industry.
"The House will be aware that from last Monday night, the unions representing manual workers in the water industry imposed an immediate ban on overtime and call-out for emergencies. They also

21
announced that, with effect from midnight last night, there would be a national strike.
"The latest reports indicate that there have been some adverse consequences arising from last week's industrial action, which have affected normal water supplies in a number of local areas. Where it has not been possible to repair burst pipes, a supply has been maintained by stand-pipes or tankering, as appropriate. In the South-West, Manchester and parts of Wales, the water authority has advised the public, as a precaution, to boil any water to be used for drinking or cooking. Reports at midday today indicate that some 2,000 properties are without their normal supply. Water authorities have dealt this morning with bursts in major water mains in Eltham, in South London, and in the centre of Coventry. There have been no major pollution incidents reported.
"My department is in close touch with the reports from the water authorities, who are seeking to maintain adequate services to their customers. As I informed the House last Tuesday, contingency steps have been taken by the Government in the event of water undertakers asking for assistance to maintain essential services.
"Mr Speaker, the House will be aware that intensive discussions have been taking place under the auspices of ACAS in an attempt to resolve this serious dispute. On Friday, agreement was reached on a procedure involving negotiations under an independent chairman appointed by ACAS. It was also agreed that his powers should further extend to those of a mediator so that he could recommend terms for a satisfactory settlement.
"These talks began on Saturday morning. At that stage, the employers increased their offer. That offer was rejected and, after further discussions, the independent chairman, acting then in his role as mediator, made recommendations for a settlement. The main recommendation was for an increase of 7.3 per cent. over 16 months, plus another 0.5 per cent. from an increase in the five-year service supplement. The employers have indicated that these recommendations are broadly acceptable.
"I understand that the trade union side of the NJIC is meeting this afternoon to consider these recommendations and that the full NJIC will meet this evening.
"I very much hope that it will be possible for agreement to be reached at this evening's meeting and thus to end at the earliest moment the industrial action in the water industry, which could otherwise have increasingly serious consequences all over the country".
My Lords, that is the end of the Statement.
Baroness Birk: My Lords, we thank the Minister for repeating that Statement. All in this House are aware that this is a very serious matter; already millions of people are having to boil water. The situation could rapidly worsen within two or three weeks, by which time the sewerage system would become unusable, with sewage flowing into the rivers. Under the law, the Government have a statutory obligation to provide all
22
water users with a wholesome supply of water. Under EEC and British legislation, they have the further statutory obligation to maintain the quality of river water. How do the Government intend to fulfill those legal obligations?
In November, the employers were ready to negotiate at around 6 per cent., until the Minister, who is now the Secretary of State for the Environment, 'phoned to stop that and insisted on 4 per cent. Without going further into figures, I would only say that we on this side feel that, in view of the range of wage increases today and the cost of living, 4 per cent. is a very low figure for people who have not earned very much and who appear to be near the bottom of the wage increase list.
Since that time the employers have not returned to the negotiating table until last weekend, so there has been the great delay of nearly three months, during which time the whole situation has worsened. Is it not a fact that yesterday's recommendation by the mediator amounts to 5·9 per cent. over 12 months, which is slightly less than the chairman of the National Water Council was prepared to offer in November? I have translated the percentage of the 16 months into the 12 months and have given the figure in that way. Thus, we have not only had a two-month delay, which has brought us to this grave and highly dangerous situation, but the intervention of the Minister was the direct cause of the breakdown, and we are all aware that once there is that sort of breakdown and that type of delay, there is unfortunately then produced a psychological climate which makes agreement and negotiation even more difficult. Will the Minister give an assurance that the mediator will now be free to negotiate without interference, and that the Government will not take any provocative action that will prejudice theoutcome?
Finally, does not the Minister agree that it is imperative that the dispute be settled rapidly on reasonable and honourable terms? It is ridiculous that in 1983 we should be on the brink of a breakdown of this kind in a country which we consider to be civilised and socially aware.
4 p.m.
Lord Evans of Claughton: My Lords, from these Benches I should like to say that we welcome the recommendation of the mediator of a 7·3 per cent. payment over 16 months, because in any terms this is a low-paid industry. We recognise that the workers did not necessarily agree to accept the mediator's recommendation. However, would not the noble Lord the Minister agree that, as the noble Baroness suggested, it would be a great tragedy should the country get into grave difficulties if workers who are in a particularly strong position to put pressure on the Government abuse that position? From these Benches we hope that the meeting this evening will reach an agreement that will be acceptable to both sides.
Finally, we accept that there are dangers in the emergency brought about by this action, but would not the noble Lord the Minister agree that it is important that the householders in this country should not be panicked into a belief that matters are more serious than they are? I think that the noble Lord the

23
Minister might agree that, judging from what one reads in the papers and from what one has heard, people are being driven into panic when that situation does not yet justify it. I hope that he can reassure them.
Lord Bellwin: My Lords, on that latter point I should like to say at once that I am very grateful to the noble Lord, Lord Evans of Claughton, for bringing it out. He is absolutely right; there is certainly no need for any panic, or anything even approaching that. The fact is that the sewerage system will not become unusable. The noble Baroness, Lady Birk, said that the situation could worsen within two or three weeks, but I am sure that all your Lordships hope that we shall not be in this situation in two or three weeks' time. Indeed, if it lasted that long, it would of course be worse than it is today, but even then there would be no cause to believe that there would be anything like the disastrous situation which the noble Baroness fears.
I am not going to respond in any belligerent tone, nor am I going to rise to the bait following the way in which the noble Baroness put her observations, other than to say this: the noble Baroness, Lady Birk, tried to imply that my right honourable friend the Secretary of State (as he now is) had insisted on 4 per cent. I think that that is quite wrong; that is not the case. The fact is that the Government have intervened neither more nor less than Governments have ever interfered in matters of this kind.
I still believe that at this moment it would be wrong for us to start to discuss a matter that is delicately poised. It was announced in the Statement—was it not?—that negotiations are taking place this afternoon, and that there will be a further meeting this evening. Anything that we now say that would exacerbate that situation would not be helpful, and therefore I now prefer not to proceed on that point.
The fact is that the mediator is there; he has the opportunity. He is absolutely independent, and I think that that is a plus. The trade union is under an agreement to go to arbitration, which it has chosen not to do. But at least the mediator is acting in this capacity. I think that that is a good thing, and I hope that it will reach a conclusion.
I agree with both the noble Baroness and the noble Lord, Lord Evans, when they say that it would indeed be a tragedy if the situation were to develop at all. I sincerely hope that it will not. The fact is that here, as in so many other things, one is trying to see, and to hope, that there will be equity. I should remind the noble Baroness that the statutory obligation regarding provision lies not with the Government, but with the water authority, and I am sure that it knows that very well indeed. So far as my response to the Front Bench is concerned, I think that if I go no further than that, it will probably be more helpful than would otherwise be the case.
Lord Nugent of Guildford: My Lords, I should like to thank my noble friend for repeating the Statement, and to say how sorrowful it is to me to see this great industry in this parlous condition. I speak in particular in the light of my own experience. I was chairman of the NJIC, and in the past I have conducted similar negotiations. Is my noble friend aware that workers in
24
the industry are not as acutely under-paid as some noble Lords might have suggested? The average earnings are £136 a week, and the average value of the award would be £8-plus per week. Those figures are not negligible. Is my noble friend also aware that I cannot help thinking that the majority of water workers, who are public-spirited, decent men, would be ready to settle for that kind of figure?
Therefore I most earnestly hope that at the NJIC meeting this afternoon the leaders of the three unions will have the usual good sense that I have seen them exercise so many times in the past, and will accept the offer which the independent arbitrator has made and which the employers seem disposed to accept, so that this very dangerous dispute may be settled. There is no doubt that as each day goes by more people will be cut off as bursts occur and main valves have to be turned off. Therefore water supplies to houses will disappear. In the course of a week or two very large numbers of houses all over the country, and indeed industries, will be without water. I feel sure that that is not something which those who work in the industry would want to see. I most earnestly hope that they will accept the proposal this afternoon and bring this very dangerous dispute to an end.
Lord Bellwin: My Lords, I am most grateful to my noble friend, with his vast experience of the industry. In reply to one of his points. I would say that, yes, I am aware of the earnings level to which he referred. It is about an average of the pay of all manual workers. I said, and I still think, that I should not comment in detail on the proposed settlement itself while it is in its present stage of negotiation. But—and I am sure that I speak for everyone in your Lordships' House—I indeed endorse the wish that the matter be settled very speedily.
Lord Diamond: My Lords, as I, too, am most anxious not to say anything that touches too closely on the exact proposals that are under consideration, I should like to proceed from the particular to the general. I wish to ask the Minister whether he does not consider that the situation is yet a further example of the unsatisfactory nature of the method that we have of solving pay disputes. I should like to ask the Minister when the Government have it in mind to introduce proposals which will make it unnecessary for trade unionists to put to maximum inconvenience fellow trade unionists, and their wives and their children, in order to pursue their undoubted right to secure a fair day's pay for a fair day's work.
Lord Bellwin: My Lords, on the latter point, the very fact that there is a dispute at all arises because, on the one hand, there are those who have to take account of the ability to pay on the part of those who, at the end of the day, pay the bill—bearing in mind also what is paid to others—while, on the other hand, there are those, as the noble Lord said, who feel that they need to have more money to take home. There will always be differences in such a situation and that is what negotiation and discussion are all about. The noble Lord asked, is not the situation a further example of the unsatisfactory nature of solving pay disputes? Well, indeed it is. But when there is a perfect way of doing it, I shall be very pleased to hear about it.
Lord Boardman: My Lords, is my noble friend aware that in the private sector there are a number of firms which, while unfamiliar with the systems, have the skills and competence to deal with a great deal of the maintenance and repair work that at the moment is not being done? If this unfortunate strike continues, will he consider encouraging the Water Council to make use of those facilities, and so relieve some of the hardship and industrial loss that otherwise will follow, and also show that a monopoly of this kind must not be used to abuse the public?
Lord Bellwin: My Lords, I hear what my noble friend says. There are many who have spoken similarly and who have sympathy with that view. I think that for today, however, I should prefer not to comment on that. We are most anxious that this matter should be settled. What the future would hold in that way, is, I think, and I would suggest, properly for another occasion rather than for today.
Lord John-Mackie: My Lords, may I ask the noble Lord who gave the advice not to fill the bath, et cetera? He mentioned the fact that people should not panic but there is all the difference between panic and precaution. I have a whole yard of cattle to get watered. My son suggested filling the swimming pool but I persuaded him that it was Government advice not to do this. I am wondering whether my advice to him not to do it was right.
Lord Bellwin: My Lords, only time will tell.
Lord John-Mackie: My Lords, who gave the advice?

Mobile Homes Bill [H.L.]
4.11 p.m.
Report stage resumed.
Lord Bishopston Lord Bishopston moved Amendment No. 3:
Page 2, line 30, leave out subsections (3) and (4) and insert—
("(3) Where the owner has offered the occupier an agreement under this Act within the required period—

(a) if the terms of the agreement so offered are unacceptable to the occupier, the occupier may, within six months of the offer, apply to the court for an order requiring the making of such an agreement;

(b) if the occupier already occupies the mobile home as his only or main residence, he may accept the offer at any time;

(c) where paragraphs (a) or (b) above do not apply, the offer shall he treated as withdrawn six months after the date on which it was made.").

The noble Lord said: My Lords, I beg to move Amendment No. 3. This amendment is similar to one which was discussed at Committee stage without Division a week or two ago. It seeks to replace subsections (3) and (4) of Clause 2 with a new subsection (3). The new subsection deals with the situation where an owner has made an offer under the Act. If it is unacceptable, the occupier may apply to the court. The period during which that may be done is extended from three months to six months. We believe that the period of six months is a reasonable one, three months being really quite inadequate and not enough time for the occupier to recognise the inadequacies or shortcomings of the offer made by the
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site operator and, indeed, to seek advice from Citizens Advice Bureaux or from legal sources, or to see a solicitor, possibly seeking legal aid, and to make an application to the court. There are problems where agreement is not being made or where the terms are not clear.
The amendment seeks to deal with the position where the owner has offered an agreement but where it has not been accepted or challenged. As the House will know, at present, according to the Bill, the mobile home occupier who, through ignorance or inertia, does nothing about it is in a vulnerable position. It is all very well for some to say that people should know and should exercise their rights; but a good percentage—25 per cent.—of mobile home occupiers are elderly. Half of them are over 40 years of age—which, of course, is not too old—and about 28 per cent. are young people with families. There are some categories here in which those involved may not be able to enforce their rights, or know what they are.
We also think the time of three months is too short if the occupier has had to act in that relatively short space of time to get to know his rights, to seek legal aid and so forth. It is really not long enough. The noble Baroness, Lady Trumpington, claimed in Committee that she thought that three months was too short, and that a period of six months was more acceptable. I am sorry she is not here to give her support today to what I am saying. We believe that on the period aspect the noble Lord the Minister has some sympathy. He said, in fairness, that it is an arguable point, and he stressed this twice. If he thinks that six months is too long and the rest of us think that three months is too short, I really think there is a chance of some compromise between those periods. Perhaps he can have a look at this.
The third part of the amendment safeguards the position of the site owner who has made an offer to a prospective occupier, and in that event the offer would be treated as withdrawn after six months. This amendment has already had some indication of support from the other side of the House, and certainly from noble Lords who are supporting it, and I believe that the merits of the case are worth considering. I hope that the Minister will be able to come to some agreement within the period I have suggested.
Lord Evans of Claughton: My Lords, may I say briefly but, I think, with considerable strength that I believe that three months is far too short a time and that six months is more appropriate. It is the period set up for similar kinds of action under the Landlord and Tenant Acts. I do not want to suggest in any way that the legal profession goes in for delays. I can assure you it does not; it does what its clients ask it to do. Very often, clients ask solicitors to delay things. For all the things that may be needed to be done before the occupier takes the matter to the courts, I can say with complete certainty that three months is not a long enough period. As the noble Lord, Lord Bishopston, has said, it may be shorter than six months. From my experience of similar kinds of problems, I believe that s six months' period would be appropriate in this case. I think that this should be given serious consideration by the Government.
Lord Bellwin: My Lords, I am not without sympathy for what is being said here, but it is not quite that straightforward. There is one respect in which I am quite sure that the approach which the amendment takes is balanced too far against the site owners, and that concerns the position of occupiers who are on a site at commencement. The amendment would place no time limit on their ability to accept, refuse or challenge any agreement. This would place the site owners in an uncertain position in respect of everyone who was on site at the commencement. Apart from anything else, site owners would never know when they were likely to be taken to court. That does not seem to be fair. I am not even sure that it would be entirely in the interests of occupiers to have forever in which to decide. I do not think that there is any possibiliy that the Government would be prepared to accept that aspect of the amendment.
For the rest, we are talking about numbers. Given that the offer of an agreement will be accompanied by the notice that we will prescribe, advising the occupier to read the Government's booklet and stressing the importance of the time limit, I am still inclined to believe that three months is adequate. Having said that, I accept that this is an absolute judgment. Certainly, the noble Lord, Lord Evans, when he talks about the legal requirement, and so on, makes a fair point. I cannot today accept this amendment as it is. We are coming now to the later stages as far as your Lordships' House is concerned. May I say—and I am choosing my words carefully—that we will consider this point again, assuming that the noble Lord withdraws his amendment. I cannot undertake what we will decide, nor even, if we did decide, that we would have the opportunity to do anything in your Lordships' House; but I know from discussions with colleagues following the debates during Committee stage that no one is saying that this is a closed issue. If your Lordships will bear with me and perhaps withdraw the amendment with that in mind, without an undertaking other than that we are not unsympathetic to the point that is being made, perhaps we can move on.
Lord Bishopston: My Lords, I am sure that the House are pleased at the tone of the Minister's reply to this amendment. The amendment is an important one and I suspect that he is not fully happy with the six months' period. Nevertheless, his reply justifies my seeking the consent of the House to withdraw the amendment.
Amendment, by leave, withdrawn.
4.20 p.m.
Lord Bishopstonmoved Amendment No. 4:
Page 3, line 5, at end insert—
("(7) The Rent Officer shall, on the application of the owner or the occupier, specify the extent to which he considers to be reasonable sums payable by the occupier in pursuance of an agreement under this Act and the occupier shall not be liable to pay more than the sums so specified.
(8) In determining for the purposes of subsection (7) above what sum is or would be reasonable—

(a) regard shall be had to all the circumstances (other than personal circumstances) and in particular to—

(i) the character and locality of the protected site;

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(ii) the place within the protected site where the mobile home is, or is to be, stationed;

(iii) the services available to the occupier on the protected site; and

(iv) rates payable by the owner in respect of the protected site; and

(b) there shall be disregarded—

(i) the condition of the mobile home;

(ii) the fact that the agreement was offered or made under this Act.").

The noble Lord said: My Lords, this amendment is one of real importance. We were very concerned in the earlier stages with the problem with which this amendment seeks to deal. This amendment would give power to the rent officer to deal with an assessment which he might consider fair to both the site owner and the occupier, thereby keeping the balance and setting out criteria for that purpose. That is very important. Rent officers, as we all know, have the experience required and would be competent, and—most important—they are respected by all concerned. The Minister has paid tribute to them in the past.
The amendment seeks an independent check on the reasonableness of the charges made. The Bill gives power to the court to deal with charge fixing situations in an agreement, but the criterion which we recommend to the House is taken from the Rent Act 1977. At the same time it does not take into account scarcity value, which I think is an important point. Occupiers, as we know, have the right not only to expect security of tenure, but also to be protected from excessive charges. Clause 2(5) refers to the power of the court to make an agreement under the Bill on such terms as is considered just and equitable in the circumstances. The interpretation of the term "court" in Clause 5—to which I have made reference on previous occasions—is not such as to give us confidence, for it covers a county court or an arbitrator. There is an amendment later from the Minister about the county court.
The arbitrator can be anyone whom the parties agree to as someone to arbitrate in their dispute. It could of course be a friend or relative of the site owner if the mobile home occupier agrees to it. Some of the people who live in mobile homes to which I have made reference may well not be aware of their full rights, and the site owner can say, "I am sure you will agree to Mr. A or Mrs. B arbitrating in this situation". Indeed, it could be a site owner; it could be a friend; it may be a greengrocer or somebody known to both parties as a fair person. It may not be the county court which comes near to people's expectations as a place where they can get justice and advice on what is a reasonable rent.
A rent officer may not make decisions acceptable to both sides, but the reputation of rent officers being experienced in the matters referred to them is such that I feel sure their decision would be accepted as being from someone who acts fairly. The rent officer would accept that the site owner must be allowed a fair rent, a fair return on his capital, and the occupier. with less bargaining power, should at the same time be protected from exploitation. There is this balance of fairness between the two parties—the balance that the Minister on numerous occasions said was so desirable—and rightly so. There is harassment by bad

29
site owners. We all know this. It has been accepted by the DoE. Some occupiers may not like to seek a fair rent arbitration for fear of the consequences. When they do, we should ensure that at least they get a fair hearing based on uniformity—and this is important—of criteria by those experienced in the work of rent assessment.
We debated this question in Committee on a slightly different amendment. The Minister will be aware of the amendment in which we said that the arbitrator should be someone appointed by the president of the Royal Institution of Chartered Surveyors as somebody who would be experienced in this matter. That was not acceptable to the Government. I am sure we are anxious that where the county court does not become involved, the definition of the court as an arbitrator—the arbitrator can be anyone—is something which should be looked at.
The Minister, as I have said before, sees the Acts of 1977 and 1980 as not being relevant to mobile homes legislation. We accept that the two Acts cannot apply to mobile homes, but there is no reason why the rent officer, with his vast experience and in view of the way in which he is accepted by all concerned, should not use the provisions of this measure in the circumstances to which it applies. That surely is a very reasonable proposition to make.
Referring to rent officers on 2nd December, at column 1340 of Hansard, the Minister said:
"I think there is general acceptance that they have skills and knowledge which enable them to hold a reasonable balance, at least one which makes a very hard situation tolerable. I gladly pay tribute to them—and I know quite a lot about the way in which they work".
That is a great tribute indeed coming from the Minister, who with his experience in local government has been in touch with rent officers over a long period of time. The Minister has said that he is not happy about rent officers being brought in and that the courts are able to deal with the rents. They do not always know the criteria because they deal with so many other matters. They are not sure to what extent they get brought in on rent matters. In the case of the two Acts to which I have referred, the rent officer does that work. We see no reason why he should not be brought in again. This amendment tries to bring in somebody who is experienced and is accepted by all concerned, and who has the ability to bring in a degree of uniformity as between one side and the other. That is the ideal person to do the job.
Lord Evans of Claughton: My Lords, I suspect that one of the great success stories of the post-war world is the creation of the rent officer. Rent officers seem to be fairly well accepted by their creators, by the tenants and by the landlords. The atmosphere in which they conduct their proceedings is informal. They act fairly rapidly, and there is very little criticism of their decisions. I wish that could be said of a lot of other organisations that have been created since the war. They are the ideal people for the purpose.
The problems about going to the courts under the charging clause are apparent. To the uninitiated, the atmosphere in a rent officer's office is very different from the rather daunting atmosphere of a court. The necessity of initiating proceedings of various kinds is rather frightening official procedure to the average
30
layman. As the noble Lord, Lord Bishopston, said, in any event the question whether the charges are fair or unfair is difficult for a county court judge or registrar to answer. With the excellent opinion in which the rent officers are held on such a broad front, I would have thought that the Minister might have welcomed this amendment as an improvement to the Bill.
Lord Bellwin: My Lords, we are actually going over an amendment identical to one we went over in Committee, and it will probably be no surprise if I make the same arguments now as I did then. The first of them is that the rent officer service is not equipped to deal with pitch fees on mobile home sites. I am second to none in my admiration for rent officers. I said it on the last occasion, and I happily say it again. I know precisely how they operate. The fact is that the rent officer's job is to fix rents for houses and flats within the Rent Acts; but registering fair rents for tenants of houses and flats is not the same thing as fixing a pitch fee which an owner-occupier of a mobile home should pay. Not only are mobile homes in themselves quite different, but surely the critical point is that we are not here concerned with the rent for accommodation. Mobile home owners are paying for a licence to occupy land and to receive certain services.
The noble Lord, Lord Bishopston, says that rent officers could acquire the expertise to deal with mobile home sites. I am sure that he is right about that: I expect they could. What he does not explain is why rent officers should have to do so. If he believes that rent officers are the only people who can arbitrate fairly between a site owner and an occupier, then I have to say that I do not share that belief. I believe that people other than rent officers can also act as arbitrators. Surely, it is not impossible that a person may be known to both site owner and home occupier whom both would find acceptable to resolve the dispute between them.
I hope we are not again going to spend a lot of time discussing the appointment of an arbitrator. I made many points in Committee. The choice of an arbitrator is a free one to be made between the site owner and the occupier. It might be helpful if I add that the general law relating to arbitration will itself protect occupiers from the worst abuses that noble Lords are trying to guard against. If an arbitrator is not impartial and disinterested, his decision can be set aside by the court. In appropriate circumstances it is also possible to apply to the court before going to the arbitrator for his appointment to be set aside under Section 24 of the Arbitration Act 1950. The chances that the site owner would get away with appointing, for example, his agent or his brother-in-law as an arbitrator are therefore severely limited.
I should like to make a further point about the rent officer service. In Committee the noble Lord, Lord Jacques, argued that to bring them into this Bill would have a great psychological value for occupiers. It would also have a psychological impact on the site owners. They know as well as anyone else the effect that the Rent Acts have had on private landlords. They do not want their mobile home sites to be affected in the same way, and I do not believe that your Lordships' House would want them to apply to these sites for fear that they would have this effect.

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We are back once again to this whole matter of a balance. I strongly contend that the owner-occupied mobile homes do not need the rent officer service; nor can we be sure that bringing rent officers in would have the desired result. We clearly have a difference here, but the Government are adamant about it and the noble Lords may feel able not to press their amendment.
Lord Bishopston: My Lords, the noble Lord the Minister quoted my noble friend Lord Jacques, but I should like to quote from what he himself said at col. 1342 on 2nd December, during the Committee stage. I quote:
"The point that the noble Lord makes about going to court is the most important part of what he was saying, if I may say so. People do not want to go to court. People dislike this; they fear the costs; they fear it might involve them in all kinds of traumas. So they do not want this, and I understand it."
This, I think, is the point, apart from the costs concerned. The Minister keeps saying they can go to court. but that is really not a satisfactory way of doing it. Although one accepts the county court as being part of our judicial system—and very commendable it is—I suggest that on the matter of rents they are not as au fait with the criteria as the rent officer is; and the matter of going to an arbitrator is really more worrying still because arbitrators can be anyone on whom the two parties agree. It may, for example, be some relative of the site owner who is known to both as a fair person; but what on earth does he know about rents? What does he know about the uniformity of values throughout an area? I would suggest this would not be a fair way of getting arbitration.
We tried, with one amendment, to get the Chartered Institute of Surveyors to recommend arbitration people who would be not only acceptable but fair to both sides. Now we are suggesting rent officers. I believe this is an area which the Government must look at again. Although I feel inclined to press this, I believe that the Government should be given another opportunity to look at this matter. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 3 [Successors in title]:
4.35 p.m.
Lord Bellwinmoved Amendment No. 5:
Page 3, line 6, at beginning insert ("(1)")
My noble Lord said: My Lords, Amendment No. 5 is a paving amendment to amendments Nos. 6,7 and 8 and, with your Lordships' agreement. I will speak to this group of amendments together. They apply to the inheritance provisions of the Bill. An amendment to these provisions was tabled at the Committee stage by the noble Lords, Lord Avebury and Lord Bishopston, and proposed most eloquently, if I may so, by the noble Baroness, Lady Fisher. In my response to the noble Baroness, I accepted that the provisions as they stood in the Bill, which followed those of the Mobile Homes Act 1975, had given rise to some concern. I promised to consider the possibility of a change. I am pleased that we have been able to make that change.
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These amendments will extend the Bill's provisions in a way that meets the case argued by the noble Baroness, but avoids the less desirable results that we feel her amendment, as it then was, would have had.
The Bill, as presently drafted, enables a member of an occupier's family who was living with him at the time of his death to inherit the full benefit of the statutory agreement which the deceased occupier held. These amendments will not change that provision, though they will clarify it a little. The amendments will come into play if the occupier does not have a member of his family living with him at the time of his death. In that case, the person to whom the deceased occupier leaves his home will inherit the right to sell the mobile home on site and assign the agreement relating to it. He should, as a result, be able to recoup the value of the investment which the deceased occupier made in buying the home. The amendments will not, however, enable this heir to come and live in the mobile home—unless, of course, he makes a new agreement with the site owner to do so. It is primarily in this last respect that these Government amendments differ from the amendment proposed in Committee by the noble Baroness, Lady Fisher. Her amendment would have allowed the person who inherited the mobile home to come and live in it, without any say in the matter for the site owner, possibly at the cost of disturbing the other occupants of the site. The Government amendments will avoid that possibility. At the same time, they will achieve the essential aim of enabling someone who buys a mobile home to leave the value of his investment to his heirs.
I hope it will be helpful to your Lordships if I explain the effects of this amendment a little more fully. Its drafting is, I must confess, a little complicated. If no member of an occupier's family is living with him at the time of his death, the person to whom he leaves his mobile home will be entitled to sell the home on site and assign the agreement. The heir in these circumstances will not be entitled to come and live in the mobile home; nor will he be entitled to make a gift of the home under paragraph 9 of Schedule 1, Part I. During the period between his inheriting the home and selling it—the "pre-sale period"—he will be liable for the occupier's obligations under the agreement. He will, for example, be responsible for paying the pitch fee and for keeping the mobile home in good repair as the agreement requires. The site owner will also continue to be liable for his responsibilities during this period. He will be able to exercise his right to terminate the statutory agreement during this pre-sale period, on the grounds of breach of agreement or on the grounds that the mobile home will not last another five years, if a five-year point falls within the period. He will not, of course, be able to terminate the agreement on the grounds that it is not being occupied as an only or main residence.
The way in which these amendments are drafted will, therefore, give some protection to a site owner. If the person who inherits a mobile home does not pay the pitch fee or allows the home to fall into disrepair, the site owner will be able to protect himself. But, more importantly perhaps, these amendments will give a new kind of protection to mobile home occupiers. Many occupiers are retired people and I know that there has been anxiety about the existing

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inheritance provisions of the Bill. These amendments should remove that anxiety. They will enable people to buy their mobile homes in the confidence that they can pass on the value of their investment to their heirs. They represent an important and valuable change to the Bill's provisions. The change is one which I felt your Lordships were looking for in Committee and I hope that it will be welcomed now. I beg to move.
Baroness Fisher of Rednal: My Lords, before I speak to the amendment, may I ask the Minister to accept my best wishes on his appointment. We are all pleased that his abilities have been recognised by the Government.
I welcome the amendment provisions and thank the Minister for honouring the undertaking which he gave on the second day of the Committee stage. I welcome also the Minister's elucidation of the clause. I found the greatest difficulty with Clause 3. I read and reread it, and the more I read it the more confused I became. The Minister's knowledge has resulted in an interpretation which I believe executors of wills and solicitors will very much welcome. Clause 3 was drafted in a very confused way. May I ask the Minister whether there is any possibility of the clause being reworded a little more simply so that there is no dubiety about it? There is dubiety about the clause.
I have in my hand one of many letters which were sent to me after a broadcast of "Today in Parliament". One of the letters says:
"It would be nice if the owner of a caravan was able to pass on this to his next of kin, but can I tell you what happened to my husband and I when left a nice little mobile home, only to be told by the site owner that it was not worth anything and that it had got to be removed".
In those circumstances, people who inherit will undoubtedly find themselves in difficulties if the site owner says that there is no value attached to the mobile home and that it has got to be removed. No doubt solicitors will have to make a decision about this. They will have to decide whether or not the property is of any value.
I hope I understood the Minister correctly when he said that the intention is that the person who is left a mobile home will be able to sell it and assign the agreement but will not be entitled to live in it. It may be, however, that the site owner could give an entitlement if the person who is left the mobile home is considered to be satisfactory. That seems to cover all that we expected, or 99 per cent. of what we expected. Therefore, all I have to do is to thank the Minister for looking at our amendment and for going so far towards meeting our point.
Lord Bellwin Lord Bellwin moved Amendments Nos. 6, 7 and 8:
Page 3, line 6, leave out second ("shall").
Page 3,line 8, leave out ("(a)").
Page 3,line 9, leave out from ("such") to end of line 17 and insert ("successor.
(2) Where an agreement under this Act is lawfully assigned to any person, the agreement shall enure for the benefit of and be binding on that person.
(3) Where a person entitled to the benefit of and bound by an agreement under this Act dies at a time when he is occupying the
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mobile home as his only or main residence, the agreement shall enure for the benefit of and be binding on—

(a) any person residing with that person ("the deceased") at that time being—

(i) the widow or widower of the deceased; or

(ii) in default of a widow or widower so residing, any member of the deceased's family; or

(b) in default of any such person so residing, the person entitled to the mobile home by virtue of the deceased's will or under the law relating to intestacy but subject to subsection (4) below.

(4) An agreement under this Act shall not enure for the benefit of or be binding on a person by virtue of subsection (3)(b) above in so far as—

(a) it would, but for this subsection, enable or require that person to occupy the mobile home; or

(b) it complies with the requirements of paragraph 6(1) or 9 of Part I of Schedule 1 to this Act.").

Clause 5 [Interpretation]:
4.44 p.m.
Lord Bellwinmoved Amendment No. 9:
Page 3, line 22, at beginning insert (" (1) ")
The noble Lord said: My Lords, this is a paving amendment for Amendment No. 14. With your Lordships' agreement, I shall speak to the two amendments together. Two amendments were put down when the Bill was in Committee to provide a definition of the word "family". One was put down by my noble friend Lord Campbell of Croy, the other by the noble Lords, Lord Avebury and Lord Bishopston. I did not feel able to accept either of those amendments as drafted, but I offered to consider the possibility of introducing an alternative definition at a later stage, I am glad to have been able to follow up that offer with the Government amendments which are now before your Lordships.
The word "family" appears at two points in the Bill—in Clause 3, which deals with the inheritance provisions of the Bill, and in Schedule 1, Part I, paragraph 9, which enables an occupier to give his mobile home and assign his agreement to a member of his family. It is the second of these references which has given rise to a request for the word to be defined. Site owners are concerned that occupiers may pretend to give their mobile homes and assign their agreements to people whom they claim to be second cousins twice removed in order to avoid paying commission on a sale when they are in fact receiving payment from their imaginary relation. I said in Committee that I considered this anxiety on the part of site owners perhaps to be exaggerated. None the less, I recognise their concern.
I am also aware that there was a general feeling in Committee that it might be helpful to give the courts some indication of Parliament's intentions in using the word "family". The definition provided by the Government's amendment is taken from section 50(3) of the Housing Act 1980, where it us used in relation to succession rights for secure tenancies. I believe that it combines the advantage of clarity with that of bringing in those members of a family whom it is desirable to include. The amendment will apply the definition to the references to "family" in both Clause 3 and Schedule 1.

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Before I sit down, may I deal with the questions that were raised on the definition proposed by my noble friend in Committee, in case anybody wants to raise the same points about this definition. I understand—what I say now must of course be subject to the interpretation of the courts—that the definition provided by our amendment would include a mother-in-law because of the reference to "any relationship by marriage as a relationship by blood". It would also include adopted children by virtue of the provisions of the Children Act 1975, but it would not include second cousins twice removed.
I hope that this amendment will meet the need for a definition which the Committee perceived and I invite your Lordships to accept it. I beg to move.
Lord Campbell of Croy: My Lords, my noble friend has very kindly put down this amendment in order to meet, as he generously stated, an amendment which I moved at the Committee stage. I should like to thank him and to congratulate him for introducing these two amendments.
The purpose behind the moving of my amendment at the Committee stage was that I thought that a degree of closeness was necessary: that to leave it wide open would encourage claims based on very tenuous relationships. As my noble friend has said, the Government have adopted a formula which is to be found in the 1980 Act. I am sure that with the assistance of expert draftsmen this amendment carries out broadly the purpose which I had intended at the Committee stage.
Another degree of relationship was raised at the Committee stage: whether there would be difficulty about the common law wife. I see, however, from the last line of the amendment that that situation is covered. At the Committee stage I said that I thought there would not be great difficulties in Scotland with regard to Scots law but that I was not sure about England and Wales. I assume that the last line of Amendment No. 14 covers the position for England and Wales also. Where there are any arguments about this it is for the courts to decide, but I believe that putting a definition like this into the Bill will avoid a great deal of disappointment and misunderstanding.
It will also save a great deal of time because, with this in the Bill, cases about distant relationships will not be brought up. Again, I would like to thank my noble friend for having, in the space of time before Report stage, met the point I raised at Committee stage.
Baroness Fisher of Rednal: My Lords, may I thank the noble Lord the Minister from this side of the House for this amendment. The noble Lords, Lord Campbell of Croy and Lord Avebury, put arguments at Committee stage on the subject of definition, and it so happened that we on this side of the House had exactly the same sort of amendment to put down but the noble Lord, Lord Bellwin, became the "second cousin removed" and got there before we did. It is for that reason that we welcome this amendment. We welcome it because we believe it is important in Government legislation that definitions of this type
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should follow legislation. I believe the noble Lord would agree that when we have a debate on the legal interpretations of Acts of Parliament, it is a good thing that the same definitions in respect of family membership are applied to all sorts of legal interpretations. It is for this reason that we welcome the amendment and are pleased that it is following the Housing Act 1980.
Lord Evans of Claughton: My Lords, this is a very generous amendment which the Government have put down, although I do not feel that it is quite as generous as the noble Lord, Lord Bellwin, was suggesting. For example, second cousins twice removed are excluded, quite rightly, but I understand that even first cousins once removed are excluded—which is also quite right. I see also that the child of a mother and reputed father is included, but not the child of a father living with a woman who is not the child's mother; they are excluded and the male sex suffers relative to the female sex. Again, that is probably an accepted principle although it is one that I believe should be noted; that there is in fact a slight lacuna there. People who live together as husband and wife are included. It strikes me that this is a situation which is going to cause a great deal of excitement and interest. Without being unduly delicate in your Lordships' House, one is aware that on the northern coasts of Wales and elsewhere, some of these mobile homes are love nests in the old-fashioned sense of the word.
I wonder about the extent to which living as husband and wife will be freely defined. We have in the North of England an expression with which I am sure the noble Lord the Minister is familiar, which is "living tally". Perhaps the noble Lord the Minister can confirm whether this will extend to those rather uncertain relationships which exist on a fairly short-term basis. I do not know. As the noble Lord the Minister has said, that is a matter for the courts to decide. I must say that this is very much to be welcomed on the grounds already mentioned, because it should eliminate a great deal of uncertainty and possible litigation.
On Question, amendment agreed to.
4.54 p.m.
Lord Bishopstonmoved Amendment No. 10:
Page 3, line 23, at end insert (", except in relation to paragraphs 5 and 6 of Part I of Schedule 1,—").
The noble Lord said: My Lords, having got rid of the last amendment, which was one of "relative" importance, we now go on to Amendment No. 10, and I should like to speak to Amendment No. 13 also. Amendment No. 10 is also an important amendment. I am not sure what will be the response of the noble Lord the Minister. He will, perhaps, not be quite so forthcoming as he was on the previous amendment, but we are always hopeful. These are new amendments, and they seek to modify the definition of the word "court". I will read what Clause 5 says because it is very important that the House should know what is meant by "the court", which has to assess rents and to decide on termination of agreements and a number of other matters of importance to the two parties concerned. As a magistrate myself—as other noble Lords are—and

37
knowing what courts are like, we all have the greatest confidence in them, whether they be magistrates' courts or county courts. But in Clause 5, which is the interpretation clause, "the court" means:

"(a) in relation to England and Wales, the county court or, where the parties have agreed in writing to submit any question arising under this Act or, as the case may be, any agreement made under it to arbitration, the arbitrator;

(b) in relation to Scotland, the sheriff or, where the parties have so agreed, the arbiter;".

So "the court" is not just a dignified forum of justice, accepted as the protector of all our rights, but can be an arbitrator.
As I have already mentioned, the arbitrator can be someone who is related to the site occupier. These are important aspects when one realises the powers which are being given to the arbitrator, not to the established court, which is a well-known part of our judicial system. "The court" could be an arbitator who could be a friend or relative of the site owner, as long as he is accepted by the occupier. But the occupier may be under pressure or may accept through fear or ignorance; then "the court" is not the impartial and understanding institution which is so much a part of British justice.
I have mentioned the powers of the arbitrator in relation to the interpretation contained in Clause 5. If we now look at paragraph 6(1) of Schedule 1, we see a reference to the power of the court to terminate the agreement. So this arbitrator, who could be biased towards the party seeking arbitration, can also have the power to terminate the agreement. This far from impartial situation could in some cases mean that the future security of the mobile home occupier will be at stake. I consider that it is intolerable that a person chosen by the site owner should have the absolute power to terminate any agreement; it makes a mockery of the Bill. We have debated this point at length earlier, when we recommended that arbitrators be appointed or recommended by the county surveyors' institution. This amendment seeks to promote more justice by modifying the definition of the word "court". I beg to move.
Lord Bellwin: My Lords, the Bill provides that agreements under the Bill may be terminated on a number of grounds by the court, and "the court" is defined in the following way. In England and Wales it is the county court or if the parties have agreed to submit to arbitration any questions or disputes about agreements under the Bill, an arbitrator. In Scotland it is the sheriff, or again, if the parties have agreed to arbitration, an arbitrator. These amendments are in part consequential on a later amendment, Amendment No. 17, but their effect, when taken with this later amendment, would be to enable only the county court in England and Wales, and the sheriff in Scotland, to terminate agreement. The arbitrator would be cut out altogether. For the moment, I shall concentrate my remarks on the value of arbitration in these circumstances, rather than on the grounds for termination.
We have spent a good deal of time during the passage of this Bill in discussing its arbitration provisions. One might almost think that what we were proposing in the Bill was something new and dangerous, and that it was designed to harm the interests of
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mobile home occupiers. But the occupiers who responded to the consultation paper we issued in February last year wanted arbitration just as much as the site owners did; they wanted an alternative to court action to be available. This amendment would remove that alternative for an important area of disputes under the Bill—disputes over the termination of an agreement.
I am well aware that noble Lords are worried that the arbitration provisions may be abused. They are apparently unwilling to accept that the freedom to choose an arbitrator that the Bill provides is adequate protection against abuse. I hope that what I have said about the arbitration system itself when we were discussing the rent officer will reassure them. As I understand it, the noble Lord, Lord Bishopston, is particularly concerned that an occupier will commit himself to a choice of arbitrator who turns out not to be impartial, perhaps by accepting a named individual in the agreement or in some other way. If that should happen, the occupier can apply to the court to have the appointment changed or cancelled. Even if he was aware that the site owner and the arbitrator were connected and he accepted the appointment in spite of that knowledge, the Arbitration Act of 1950 allows him subsequently to apply to the court for the existing appointment to be revoked on the grounds that he may not be impartial. So it is simply not the case that an occupier is not protected from a site owner who tries to use his agent or his brother-in-law as an arbitrator.
I hope I have said enough to show that the danger that an occupier will find himself stuck with a biased arbitrator is by no means as great as has been suggested. This amendment has also been justified on the grounds that the termination of an agreement is a special sort of issue which only a court should be allowed to resolve. I certainly do not deny that the question of whether or not an agreement should be terminated is important, but I do not see that its importance prevents an arbitrator from dealing with it. Is an arbitrator not capable of deciding whether someone is still living in his moblile home or not—the first ground for termination in paragraph 6—and is it not likely that an arbitrator could actually do a good job in deciding how long a mobile home will last—the second ground for termination in paragraph 6?
I made the point earlier on that many occupiers have asked us to ensure that arbitration is available. It can offer a quicker and cheaper means of resolving disputes than the court. It seems to me that the arbitration provisions in the Bill are fair and valuable to both occupiers and owners, whatever the dispute. I think that if the noble Lord, Lord Bishopston will carefully consider what I have said, as he so often asks me to do, he will recognise that this is the case. After all, there is nothing political in this in any way: we are simply trying to find a fair and sensible way of going about it. I do believe that the amendment is not needed.
Lord Bishopston: My Lords, I feel that this is a very important matter. It is so easy for people who do not know too much about the law to sign on entry into a site an agreement which has a clause which says that the site owner shall decide on his own arbitration. If you sign that agreement you have very little say at all;

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you have signed away your rights under the measure which talks about agreement between the two parties. It is all very well for the Minister to say that if you do not like what the arbitrator decides you can go to the court. Surely arbitration means that you accept the decision of the aribtrator. Would not the court say, "You put this to arbitration and now you do not like what the arbitrator has decided you come to a second forum"? In that case why not go to the court straight away? That is what the amendment is about—going to an acceptable forum where the ruling will be such that both sides will see that justice has been done, even if they do not agree. I have never known of a situation where you can have arbitration and then if you do not like the result you can go to someone else to have it reconsidered, if that is what the Minister was saying.
I still think the principle at stake is one which should receive further consideration by the Government, and certainly by my noble friends and myself. I should like the Minister to comment on the points I have made about people having the right to go to another forum if they do not like what the arbitrator says. This must surely be unique.
Lord Bellwin: My Lords, I have some difficulty in following the noble Lord. Only a few moments ago he was saying that he was concerned about the courts being clogged up by applications; now he is saying, do not have an arbitrator but go to the court. He really will have to make up his mind which he wants. As far as I am concerned, the prime matter here is whether or not both sides can receive equity without the necessity of having to resort to the courts. Yet there can be no harm, at the same time, in retaining an opportunity—should all else fail and everyone be unhappy—for either side to fall back on it. There can be no harm in having the first as a desirable option, which occupiers themselves have said they want, and at the same time, if all else fails, having the right of recourse to the court. I see nothing wrong in that. I just could not say that we would deny the opportunity for arbitration as an option should the parties decide to have it.
Lord Bishopston: My Lords, I can accept what the Minister says, that we do not want to clutter up the courts. But I should like the Minister to reconsider the matter from the point of view of the status of the arbitrator, who should be someone not only impartial but also experienced in the matters which would be referred to him. It is not only about rent levels but is also about reasons why someone should terminate an agreement and get off the site. We suggested last time the Royal Institute of Chartered Surveyors. If the noble Lord could have another look at that, we should be grateful. With those comments, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
5.15 p.m.
Lord Bellwinmoved Amendment No. 11:
Page 3, line 25, after ("court") insert ("for the district in which the protected site is situated")
The noble Lord said: My Lords, with your Lordships' agreement, I will speak to Amendments
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Nos. 11 and 12 together. These are purely technical amendments and need not detain us long. Their effect would be to provide that the appropriate court to deal with a dispute arising under the Bill would be the court which has jurisdiction for the area in which the mobile home is situated. Without these amendments, I understand, there might be some doubt in Scotland as to which sheriff is the right one. The second of these two amendments, No. 12, will remove that doubt. No. 11 makes parallel provision for England and Wales. I beg to move.
Lord Bishopston: My Lords, this seems to be a matter of drafting and clarifying the powers of the court for the area concerned.
On Question, amendment agreed to.
Lord Bellwinmoved Amendment No. 12:
Page 3, line 29, after ("sheriff") insert ("having jurisdiction where the protected site is situated")
On Question, amendment agreed to.
Lord Bishopstonmoved Amendment No. 13:
Page 3, line 30, at end insert—
("In relation to paragraphs 5 and 6 of Part I of Schedule 1, "the court" means, in relation to England and Wales, the county court and, in relation to Scotland, the sheriff.")
The noble Lord said: My Lords, I spoke to this amendment with Amendment No. 10. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Bellwinmoved Amendment No. 14:
Page 4, line 11 at end insert—
("(2) A person is a member of another's family within the meaning of this Act if he is his spouse, parent, grandparent, child, grandchild, brother, sister, uncle, aunt, nephew or niece; treating—

(a) any relationship by marriage as a relationship by blood, any relationship of the half blood as a relationship of the whole blood and the stepchild of any person as his child; and

(b) an illegitimate person as the legitimate child of his mother and reputed father;

or if they live together as husband and wife.")
The noble Lord said: My Lords, I spoke to this amendment with Amendment No. 9. I beg to move.
On Question, amendment agreed to.
Schedule 1 [Agreements under Act]:
Lord Bishopstonmoved Amendment No. 15:
Page 5, line 14, leave out ("and")
The noble Lord said: My Lords, I beg to move Amendment No. 15, and would also, with your Lordships' leave, speak to Amendment No. 16. The amendment is aimed to ensure that the terms of the agreement under the Act shall be in such form as may be provided by the Secretary of State; in other words, it permits the Minister to lay down model terms which we believe should be included in the statutory agreements. The DoE Report of 1977 came to the conclusion that the statute itself should impose implied terms into all residential agreements. The present Bill has not accepted that, and this amendment seeks to combine the advantages, but not

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necessarily the mechanics, of the implied terms with the approach adopted by the Bill.
In Clause I the Bill provides that the agreement must comply with the requirements of Part I of the schedule and must include terms concerning the matters mentioned in Part II. Beyond that the Bill does not give guidance to anyone as to what agreements should look like and what they should contain, and it will be an expensive waste of resources for all concerned, including the site owners, if lawyers all over the country have to sit down to devise agreements which comply with the Bill. We do not believe that that is in the interests of either the owner or the occupier.
Moreover, we also say that, even while complying with the schedule, there will be considerable room for unfairness and injustice in the preparation of agreements. As an example, a site owner may in the agreement reserve the right to make site regulations and provide that the resident must comply with those regulations. It would be very difficult for even the well-informed and determined resident to challenge such a term if the site owner, or indeed his successor later, makes unreasonable regulations. The owner would be able, under paragraph 5 of the schedule, to terminate the agreement and deprive the resident of any protection under the Bill. We believe that the Government must have in mind what a new statutory agreement should be. Why not prescribe the basic terms? There would be no need to cover every detail and individual terms could still be added to cover arrangements on a particular site.
I do not know why, but the Government appear to think that the Bill contains provisions on the lines proposed by the amendment, and we may be told that. On the second day of the Committee stage, the 6th December, the noble Lord, Lord Bellwin, said:
"The Bill says that it will be obligatory to offer an agreement. The terms of that agreement will be those which we will prescribe".
He went on to say that,
"the Secretary of State prescribes what the notice should say and what has to be involved in an agreement".—[Official Report. 6/12/82: col. 21.]
Surely that is wrong, but it is precisely what the amendment seeks to authorise. Even if the Government remain unconvinced of the need to prescribe the form and terms of the agreement it would be a very useful reserve power. It does no more than give the necessary powers and if the need arises once the Bill is in operation the power could then be used to deal with the problems. This would be much more satisfactory than coming back for yet another look at the Bill after it has been enacted. I believe it would help everyone concerned if such model terms were available. I therefore beg to move.
Lord Evans of Claughton: My Lords, we congratulate the Minister for agreeing to define "families" to simplify matters for everyone. I beg him to accept the amendment, or something similar, for the same reason. I put to the Minister the kind of thing that I expect to happen from experience of other kinds of agreement in landlord and tenant relationships or quasi relationships. The landlord, or the owner in this case, has a printed form which he has had prepared by his solicitor, his association, or whatever. One of these
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forms he hands to the prospective occupier and says. "Do you mind signing that? I shall sign this copy and we shall swap them". The chap agrees because he is anxious to get the site and he signs the form. As the noble Lord, Lord Bishopston, says, he then finds afterwards, because he has not bothered to consult the Citizens' Advice Bureau or a solicitor, that he has committed himself to something which goes beyond what he had thought on looking through the agreement. In other words, there is some small print that he has not looked at in the sense that the noble Lord, Lord Bishopston, mentioned in referring to regulations to be made by the owner at some future time. That is already not uncommon between landlord and tenant.
I should have thought that the Government would have been well advised to follow the precedent set in earlier landlord-tenant legislation where the form of notices, and so on, is set out in statutory form. For example, in the Landlord and Tenant Act the notice to terminate a business tenancy is set out in statutory form. I should have thought that from everyone's point of view, for the sake of simplicity, first, for the sake of accuracy, secondly, and for the sake of protection, thirdly, it would be very useful and advantageous if a model agreement could be used in such circumstances set out in the Bill and required to be used in that form in any relationship or agreement drawn up between the owner and occupier.
I hope that the Government will either say that they will think again about this and produce something or, if I may say with the greatest possible respect—which, as your Lordships know, means something quite different—that the Minister will reconsider what he has been saying in previous discussions, because I believe he has misled himself in the belief that there is something in the Bill which in fact is not there at all. I ask him to reconsider the matter very carefully.
Lord Bellwin: My Lords, I thought that the noble Lord, Lord Evans of Claughton, was doing very well until he came to his last sentence and spoilt it all. I wonder whether the noble Lord will feel the same after he has listened, as he always does, to what I have to say on the subject. I shall be interested to know that. We are now in a field where he has practical experience of having to make it happen, if I may put it that way and of having to deal with such matters.
We discussed this amendment in Committee and I said at the end of our debate that we could not accept the amendment but that I would read what the noble Lord said. I have read the Official Report, and very interesting it was. However, I am afraid that I still cannot accept the amendment. What was particularly interesting about the speeches made in Committee was the extent to which noble Lords are trying to give the Secretary of State powers that he does not want. That is quite a reversal. Not only is it now being proposed to give the Secretary of State the power to prescribe the form of an agreement, but the amendment will enable him to be able to add, by regulation, to the matters listed in the Bill that the agreement must cover. This is an odd argument to have on a Bill. Normally it is the Government who seek order-making powers and Oppositions who resist them. In this case it is the reverse.

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The amendment would enable the Secretary of State to prescribe the form of an agreement. I do not believe that this would take us significantly further than the Bill already does. Part I of Schedule 1 lists a number of requirements with which agreements must comply. Part II lists matters which agreements must cover. It does not say how they are to be covered. It does not say what services a site owner is to provide, nor what the basis for the yearly rent reviews is to be. Unless we are prepared to change that and control the contents of agreements in detail—and we are not prepared to take that control—surely it will not help anyone for us to prescribe the form in which the contents of the agreement are to be expressed. In any case, as I have said many times, an occupier who does not like the agreement offered to him can ask the court to order the making of a new one. The notice that we will be prescribing will emphasise to occupiers their ability to challenge agreements and will tell them to read the Government booklet on the legislation.
The second aspect of the amendment is that it would enable the Secretary of State to add to the list of matters which an agreement must cover by regulation. I have said that the Secretary of State does not want this power, but if he had it I am not at all sure that he could use it effectively. Unless he used it very soon after the Bill achieves Royal Assent it would be too late to affect the contents of agreements that are to be offered at commencement. There is no realistic way in which regulations can affect agreements retrospectively.
Even if we wanted to take a power to make regulations retrospective, it would be well nigh impossible to ensure that all those who held agreements were aware of the new terms added by them. Its is at commencement that agreements are to be offered to all occupiers then on site. It is with the contents of those agreements that we must be immediately concerned. It seems to me that if we feel there are matters which should be covered in agreements under the Bill we should ensure that the Bill deals with them, rather than create a power to add new subjects which will by very difficult for us to use effectively. I want to be as helpful as I can. After all, your Lordships are trying to give the Secretary of State more powers and I should not like to be thought ungrateful.
There are two issues which were mentioned in Committee and again today which are not covered by Schedule 1 to the Bill. The two issues which are not covered are arbitration and the site rules. Surely we have already spent enough time on the subject of arbitration, and therefore I would only add now that the Bill itself allows site owners and occupiers to use arbitration if they wish. The agreement between them does not have to provide for it, but if they do not want to use an arbitrator I do not think that we should force them to do so. In view of our earlier discussions, I should not have thought that your Lordships would wish to require the use of an arbitrator either. I am dealing with this matter at length because I take entirely the point that both noble Lords who have spoken made, that this is an important matter and I hope that your Lordships will agree that I treat it as such.
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The site rules are a different matter. The first point that must be made about them is that if the site owner wishes to enforce them, he must provide for them in the agreement which he offers the occupier. He does not have to spell them out in the agreement but he will have to allow for their existence, as does the standard agreement for the 1975 Act provided by the National Federation of Site Operators. In that case the occupier should be able to challenge the relevant term in the agreement to make sure that the rules will not be unacceptable to him. There is perhaps a slight danger that an occupier will not know the site rules. It will be possible for the Bill to contain a requirement that a copy of the site rules should be made available to occupiers, perhaps at the time when they are offered an agreement, if noble Lords thought that that was desirable. The amendment before us at present would not have that effect.
I have gone into the matter in detail and I think that that shows the respect—and I use the word advisedly in view of the fact that it was used to me—I have for the matter, and it is proper that I should do so. However, I hope, in view of my explanation, that noble Lords, particularly the noble Lord, Lord Evans of Claughton, will say, "Well, there may be a point here". I live in hopes, my Lords.
Baroness Ewart-Biggs: My Lords, in spite of what the noble Lord the Minister has said, I should still like to support the amendment because as I understand it this model agreement is merely a skeleton which can be tilled by both occupier and owner as it applies. I cannot see any reason why the occupier should go to the expense of challenging the agreement if he does not agree with it. I should have thought that that was one of the things that the Bill was trying to avoid. Can one not see the amendment as something that is providing a simplification and a safeguard in some cases? To my mind it is something that would really stand the Bill in very good stead and stand the test of time. Moreover, it will try and keep a good relationship between the occupier and the owner. From the many letters I have read that have been published in the press, it seems to be a tragedy that on these sites which do, after all, constitute small villages, the relationship can sometimes be very much aggravated through misunderstandings that could possibly be avoided by this particular amendment.
Lord Tordoff: My Lords, I should like briefly to intervene and pick up one point which the Minister made. I can well understand that he can take some amusement from the fact that noble Lords are trying to give the Secretary of State increased powers, when on many occasions we are trying to decrease those powers. Indeed, on such occasions it is either that Secretaries of State are trying to take powers from other areas, such as local authorities—and we have seen quite a bit of that in recent times—or that they are asking for open-ended powers. In a case like this where the Secretary of State is being asked to take powers to defend the weak and to assist those people who do not read Government publications as much as we do, there is a much more valid reason for making the type of insertion in a Bill which this amendment seeks to do.
Lord Bellwin: My Lords, of course the noble Lord would not expect me to agree with his side observations about the purpose for which the Secretary of State should have powers; nor do I. But let me remind him, if he will allow me, that again it is the Government who are bringing forward this Bill. We are doing so precisely because we are concerned about the 1975 Act which was originally introduced as a Private Member's Bill by he who is now my right honourable friend the Secretary of State—and want to try to improve the balance between the two sides here so as to make it all work better. We are concerned that the occupiers should in no way be disadvantaged; indeed, quite the contrary. If we did not feel like that we would not have introduced the Bill in the first place. We are saying that we want to get the best Bill and to get it as right as we can.
At the end of the day there will be those who will say, "Yes, it is an advance"— everyone has said that—"but we would have liked it a little more our way". Others will say, "It goes too far that way". I have listened with respect—and I mean respect —to what has been said because again it is not a question of an exact, precise judgment here. One has to take a view on balance and that is why we take the view that we do. We do not say that you are wrong. I do not say that at all. All I am saying is that we feel that, in the totality of what we are trying to do here, the way in which we have it now seems to hold the balance. Only time will tell.
Lord Bishopston: My Lords, the Minister is right to claim credit and we would give credit to the Government for bringing forward the Bill, but it does not follow that because the Government have brought forward the Bill it is automatically all right. Even the Government themselves would not accept that. Of course, the House is very anxious, in the light of the enormous press publicity and the concern which has been made clear to many organisations and through various bodies, about the loopholes in the 1975 Act.
Having said that, of course, we are all constructively trying to help the Government. We say that they have provided a skeleton. At the same time we say, "Make no bones about it, there is still a lot of flesh to go on" and the House is anxious to deal with that. I know that the Minister, now being a Minister of State, would not be any more impressed if we had inserted, instead of "Secretary of State", the "Minister of State", because the principle is the same, However, we believe that this amendment, or something like it, would help those involved on both sides of the mobile homes business to have the type of model terms which are essential to a good agreement. Living in hope, as we all do, I beg leave to withdraw the amendment, in the hope that we might come back to it again at a later stage.
Amendment, by leave, withdrawn.
[Amendment No. 16 not moved.]
5.28 p.m.
Lord Bishopstonmoved Amendment No. 17:
Page 5, line 38, leave out ("owner") and insert ("court").
The noble Lord said: My Lords, I beg to move Amendment No. 17. This is another important amendment. I would not like to talk about the relative
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importance of the amendments because they are all intended to try to help those concerned and also to stop any loopholes. This amendment was not moved in Committee. Paragraph 5 of the Schedule allows the owner—and I stress "the owner"—to terminate a statutory agreement and in effect to evict the occupier. It is, of course, true that he would have to go to the county court, and the Minister will doubtless tell me that. But the court has only limited powers under the Caravan Sites Act to delay the actual eviction. This power could be used for a minor breach; for instance, there could be a dispute about what is grown in the garden or a breach of some unreasonable term like preventing visits from relatives or friends which was not challenged by the occupier at the outset.
It is surely wrong and at variance with all similar legislation that the owner should be the draftsman, the judge, the jury and the effective executioner. We believe that it should be the court that decides whether a breach is sufficiently serious to merit termination of the agreement, because it is on the continuity of the agreement that the security of tenure depends.
This amendment ties in with an amendment that we tabled to Clause 5 on "Interpretation", to which I have made numerous references already and which seeks to ensure that for the purposes of this paragraph only a court, and not an arbitrator, can act. I believe that this is a very important amendment and, in view of the situation which faces the occupier, whose bargaining power is much less than that of the site owner, I hope that the Government will be able to say that they can go some way towards accepting the spirit of the amendment that I now propose. I beg to move.
Lord Evans of Claughton: My Lords, this is an important amendment. I do not know whether I am unfairly inviting the Minister to speculate on what the courts would do but, as the noble Lord, Lord Bishopston, said, perhaps the Minister can assure us that the courts would say that the owner would not be entitled to terminate the agreement, et cetera, if the breaches were of a minor nature or if the owner's actions were unreasonable; because there have been cases under the analogous position of leases where the courts have refused to order eviction of a tenant when the breaches are fairly minor. It is extremely serious because, as the noble Lord, Lord Bishopston, said, these could be for quite trivial matters. Some of us, of course, might welcome a rule which prohibited visits from relatives at our mobile home, but I was thinking of something really serious like being prohibited from wearing a daffodil on St. David's Day or not being allowed to have a Liverpool FC pennant in your window. If the courts do not feel that they have the jurisdiction to say that that is such a trivial breach of covenant that they will not enforce it, then it is very important that the decision should not be made by the landlord on quite capricious grounds such as that, but that the court should decide it. As I say, if paragraph 5 is exercised purely at the discretion of a landlord, it must be amended for natural justice.
Lord Bellwin: My Lords, I have listened carefully to what the noble Lord has said and obviously I sympathise with the thrust of that. But, again, I

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wonder whether he will still feel the same anxiety about it after I make my points. The Bill provides for agreements to be terminated in a number of ways. An occupier can terminate his agreement at 28 days' notice. A court can terminate an agreement either on the grounds that the occupier is no longer living in his mobile home or on the grounds that the mobile home is, having regard to its age and condition, having a detrimental effect on the amenities of the site, or is likely to have such an effect within five years. Finally, a site owner can terminate the agreement on the grounds that the occupier has breached its terms, provided that he has first served notice on the occupier that he is in breach and that the occupier has failed to remedy the breach within a reasonable time. It is, of course, to this last ground that the amendment applies. Its effect would be to require a site owner to go to court to terminate on the grounds of breach of agreement.
The provision enabling a site owner to terminate for breach of agreement without court action is taken from the 1975 Act. Agreements under the 1975 Act have, where they have been made, on the whole worked very well and it has not been our intention to disturb the system used by that Act unless there was good reason for doing so. I am not aware that this particular provision has caused problems. It was not mentioned in any of the responses to our consultation paper earlier this year. Given the large number of occupiers and pro-occupier organisations who responded, I think it is fair to say that, if there had been problems on this point, they would have been raised. I wonder whether, therefore, the case for this amendment is a very strong one, although the noble Lord, Lord Evans, certainly made me think about it. I wonder what he would say about the point that I have just made, that we really did get the most comprehensive and extensive responses to consultations, yet no one made this particular point as a matter for concern.
Another point that I should make about this amendment is that the Bill will allow a site owner to terminate an agreement on the grounds that it has been breached without going to court, but it will not allow him to evict an occupier without court action. The Caravan Sites Act 1968 provides that a residential occupier cannot be evicted without court action. That surely is a very important provision, and therefore is it right to say that the Bill would leave occupiers unprotected by the courts? I do not think it is. However, I look forward with interest to hearing what the noble Lord, Lord Evans of Claughton, has to say on this because he is very involved in this matter.
Lord Evans of Claughton: My Lords, before the Minister sits down, I would point out that that is precisely the point about which I was speculating. If, before eviction, the owner goes to the court and says, "I want to evict this occupier" for some totally trivial reason, I was speculating whether the courts would not say: "This is totally trivial. Go away." If that is the case, we do not need this amendment.
Lord Bishopston: My Lords, I think that this is a very important amendment because, although the Minister seems to suggest that there has been no pressure for this kind of thing, in fact the DoE review says at paragraph 333:
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"Residents normally have to comply with certain site rules. On some sites these cover no more than the essential requirements for people living close to each other—restrictions on noise at night, keeping certain pets, parking, and so on, On other sites the rules have been used to intrude unnecessarily into the lives of residents by, for example, prohibiting visitors from entering the site and specifying what can and cannot be grown in gardens".
These are some of the points to which the noble Lord, Lord Evans, referred. Therefore, these are some of the rules which can be broken on the allegations of the site owner and the termination of the agreement may follow. Perhaps I may read again the paragraph which we want to amend. Paragraph 5 of Schedule 1 says:
"The owner shall be entitled to terminate the agreement for any breach of a term of the agreement if, after service of notice to remedy the breach, the occupier does not remedy the breach within a reasonable time".
I have just mentioned some of the possibly unfair ways referred to in the DoE report in which the site owner can press for the occupier to comply with the terms of an agreement as he sees it. We believe that where the security of tenure is concerned, it should be the court, and not the site owner, who shall be entitled to terminate the agreement. This is a very important matter and I wonder whether even at this stage, the Minister is prepared to say that he will have another look at it because it is a matter of fundamental importance to those concerned.
Lord Bellwin: My Lords, with leave of the House—and I suppose that I should have been saying that all along because we are on Report—of course, we read everything that is said and we think about it. If I had really thought that the way in which the noble Lord, Lord Evans, in particular, had put the matter would have led to that kind of situation, I would certainly have said, "Yes, we will". I can only say to the noble Lord, Lord Bishopston, that we will read what has been said very carefully and think about it. I can say no more. That is as far as I can go.
Lord Bishopston: My Lords, I am far from happy with that reply, but at this stage I still live in hope and I think that we might live to look at the matter again. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
5.40 p.m.
Lord Bishopstonmoved Amendment No. 18:
Page 6, line 7, after ("a") insert ("substantially").
The noble Lord said: My Lords, I beg to move Amendment No. 18 in the names of myself and other noble Lords. Sub-paragraph (2) says:
"The court shall be entitled to terminate the agreement at the end of a relevant period if, on the application of the owner, the court is satisfied that, having regard to its age and condition, the mobile home—(a) is having a detrimental effect on the amenity of the site".
We want the provion to say "substantially detrimental effect" because "detrimental effect" could in the opinion of anyone be something of a fairly minor nature. The amendment narrows the criteria for allowing the termination of an agreement due to the condition of a mobile home. An existing problem is that owners compel residents to buy new caravans from them at regular intervals, even though the condition of the first van is perfectly habitable. The

49
formulation in paragraph 6(2) is much too loose and will allow this sort of practice to continue. It has always been argued that any mobile home has a detrimental effect on a site's amenity. It will be very easy indeed for the owner to put pressure on the occupier and threaten eviction on the grounds that a van is having, or will have, a detrimental effect, whatever that may mean. We ask what kind of security is that because the occupier will, in practice, have to buy a new van or leave. That could be very costly. The noble Lord the Minister knows of the periodic turnround of vans where an owner expects a new van to be brought from him, and as something like £2,000 or £3,000 can be involved, with new agreements and so on, it may be a costly matter indeed.
The amendment narrows the scope for eviction and the pressure to buy new vans and it will mean that the court could only terminate an agreement if satisfied that the condition and age of the mobile home meant that it was having, or would have, a "substantially" detrimental effect on a site's amenities. I think this amendment should go into the Bill. I beg to move.
5.42 p.m.
Lord Evans of Claugton: My Lords, we are still in the area of nuances of meaning of words. This is a considerable softening of the previous suggestion put forward in the Committee stage—"fit for human habitation", I think, being the criterion. I should have thought that it would be farly important that this word "substantially" should be inserted here. The owner already has, as the noble Lord, Lord Bishopston, has said, considerable powers and means of requiring new caravans and so on to be bought from him. One ought, in all conscience, to have the word that is suggested, "substantially", inserted because again, subject to interpretation by the courts, it would appear that as it stands now a site owner has complete carte blanche to tell an occupier that he must have a new caravan at very frequent intervals indeed, at substantial cost to the occupier and probably considerable profit to the site owner. I should have thought that this was a reasonable amendment that the Government might consider accepting.
Lord Bellwin: My Lords, I suppose the test is how substantial is "substantial". Where does one begin? The fact is that I believe that the Bill's existing provisions and the test which they impose are not light. The court or the arbitrator is required to consider the age and condition of the mobile home. He must be satisfied that, having regard to those factors, the mobile home is having a detrimental effect on the amenity of the site; that is, causing the site as a whole to suffer. It would not be enough for the site owner to argue that a mobile home was ugly or was of a different make from the others on the site. He must show that the age and condition are such as are harming the site. It is unlikely to be an easy matter for a site owner to persuade a court that an agreement should be terminated on those grounds when the mobile home has, in reality, a good many years' life left in it. I doubt it.
It is not only the site owner who suffers if a mobile home is in poor condition remaining on the site; it is the other occupiers as well. Their enjoyment of the site
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is affected if the amenity is damaged. More important, the price they can charge when they come to sell their homes will be affected by the state of their neighbours' homes. Do we really want to provide that an agreement can be terminated only when the effect of the age and condition of a mobile home has become substantially damaging to the amenity of the site and its value? I do not think so.
I think that everyone accepts that the life of a mobile home is finite. There comes a point when it has to be removed. We are talking about where the line should be drawn. I think that the Bill draws it in the right place. It provides strong protection for the occupier concerned and at the same time safeguards the site owner and the other occupiers on the site. The amendment would shift the balance in a way which I think is not desirable. I am far from convinced. I say again, when one starts talking about words such as "substantial", how substantial is "substantial"?
Baroness Ewart-Biggs: My Lords, if I might add one short word to the argument, it is that the amendment surely is not a very strong one. Adding just one word, surely, is only trying to protect occupiers on those very few sites where the site owner does not behave in a completely equitable way. There can be no doubt that some occupiers do suffer. Again there are the letters, that I do not think one can totally disregard, which have been published. I shall read one short extract where an occupier describes the situation on his site. He says:
"If your caravan is more than two years old on some sites, five years on others, your caravan is too old and must £… be taken off site"—
or you must sell it to the site owner for a pittance. This seems such a very moderate alteration to the meaning, but it could actually protect that tiny minority of people whom the Minister has so often said he is wishing to protect by the Bill.
Lord Bishopston: My Lords, there are two points here. One is the point about the occupier having difficulty in selling a mobile home to anyone else because, as we have said before, the number of sites with planning permission are so few. Where it is a condition that the van is therefore sold to the site owner the amount offered by him for it, even a £15,000 van, could be £2,000 or £3,000. After all, he can decide because if the occupier cannot sell it to anyone else then the site owner will buy it at his price. The second point is that he will decide on a new van being sold to the occupier at his price, on which he gets a profit. A third point is the one where we return to the disagreement on the meaning of the word "arbitrator". If it is to be Joe Bloggs who will decide on the condition of a mobile home—as I said, I do not want to weary the House on this; it could be a friend or relative of the site owner—then the interpretation would not necessarily be the one which would come from the courts. We have already debated the determination of agreement by the courts rather than the arbitrator. On the ground that the Minister might look again at the status of the arbitrator, which would give us more assurance, I am prepared to seek leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Bishopstonmoved Amendment No. 19:
Page 6, leave out lines 24 to 32.
The noble Lord said: My Lords, I seek to delete paragraph 8(2) and (3) which do away with the owner's rights to purchase a departing occupier's home in preference to anyone else. This is a point on which I touched very briefly a moment ago. In other words it abolishes the right of first refusal conferred by the Bill on the owner. We all know that considerable abuses have taken place where site owners have insisted on purchasing a van from a departing occupier. We ask the question, why should a site owner be entitled to first refusal? He makes a profit where he sells the first caravan; his continuing expenditure will be met by pitch charges and he can make a further profit, as I said a moment ago, when a van requires renewal because of its condition. The statutory rights of the owner seem to be in conflict with at least two principles of Government policy. The first is the restriction of free competition, and the second is the restriction of mobility of residents—two important points, as I am sure the House would agree. The site owner should be able to purchase a van from a departing occupier in fair competition with other potential purchasers. This is relevant to the last amendment.
In Committee the noble Lord, Lord Bellwin, thought that Amendment No. 22, which also sought to abolish arrangements for commission or discount, was too sweeping, but he conceded, in columns 42 and 43, that there was "some merit" in the arguments supporting that amendment at that time. I suggest that the present amendment is more modest. It seeks only to delete the first right of refusal, and I believe that the Bill would be strengthened by its incorporation. I beg to move.
Lord Bellwin: My Lords, may I just say, as I said on an earlier amendment, that I think there is some merit in this point. I certainly cannot undertake that we shall bring this matter in here at this stage, or whatever, but I feel, as I felt before, that there is some merit in this argument. I would not want just to turn it down. If the noble Lord withdraws his amendment I promise him that we will consider this. I will undertake that the matter will be considered.
Lord Bishopston: My Lords, I thank the Minister for his reaction, and beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
5.51 p.m.
Lord Bishopstonmoved Amendment No. 20:
Page 6, line 45, at end insert—
(" .—(1) If any question arises whether the withholding of an approval required by paragraph 8 or 9 above was unreasonable it is for the owner to show that it was not.
(2) Such an approval—

(a) may be validly given notwithstanding that it follows, instead of preceding, the sale or gift in question;

(b) cannot be given subject to a condition, and if purporting to be given subject to a condition shall be treated as given unconditionally; and

(c) shall be treated as given if unreasonably withheld.").

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The noble Lord said: My Lords, still continuing our campaign to close some of the loopholes in the measure, I shall make my comments as brief as possible. The purpose of this amendment is to bring the arrangements for the giving of approval, that is to the assignment or gift, closer to those adopted by the Housing Act 1980. In other words, the burden of proof should be on the owner to show that lack of approval was not unreasonable. The approval may follow the sale, assignment or gift. The approval cannot be made conditionally. Finally, the approval should be treated as given if unreasonably withheld.
The drafting is in keeping with the Housing Act 1980, but of course it is capable, like many amendments, of some improvement. In Committee the Minister said that this amendment tipped the balance too far in favour of the occupier. The balance is, as we have said on many occasions, too heavily weighted against the occupier, and this amendment is needed. The Minister said on 6th December (at col. 48) that the corresponding provision was needed in the Housing Act 1980 because:
"It is clearly important that a renting tenant should be able to get on with improving his home if the landlord is being difficult about the improvements".
We feel that this amendment is needed here for precisely the same reason, because the site owner might be "difficult" about approval for the more important and pressing need to sell the mobile home to a new occupier. The owner can only veto a sale by reasonable approval if he has been unreasonable, and neither the seller nor buyer is likely to take the risk. The amendment shifts the burden of proof to the stronger party and improves the procedural arrangements. The amendment is tied in some ways to the last amendment, and I think it would help the Bill. I beg to move.
Lord Bellwin: My Lords, this amendment deals with another aspect of the sale of a mobile home, and the basis on which a site owner may withhold his consent to a sale. The amendment will also apply to the provisions for the gift of a mobile home. It is another amendment that we had at Committee stage, and substantially there is not much I can add to the points I made then. The Bill uses the same approach as the 1975 Act to the site owner's consent to the assignment of an agreement; that is, it stipulates that consent must not be unreasonably withheld.
The amendment would bring in the wording of Section 82 of the Housing Act 1980. But, as I said in Committee, Section 82 is concerned with a tenant's right to improve the accommodation he has rented from the landlord. If he makes these improvements the people affected are him and his landlord and no one else. But the transfer of the ownership of a mobile home affects other people as well. It affects the other occupiers on the site. I could develop this argument at quite some length, which I suspect is not the thing to do just now. Therefore, I have to say to the noble Lord that I cannot accept this amendment. I hope I have indicated a willingness, wherever I feel there is need to do so, to look at or to make adjustments, but I do not feel that I could accept this amendment.
Lord Bishopston: My Lords, living in hope, we feel that this is a matter which can be looked at again, and

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I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Bishopstonhad given notice of his intention to move Amendment No. 21:
Page 6, line 45, at end insert—
(", . The occupier shall be entitled to give the mobile home and to assign the agreement to any person by virtue of a testamentary disposition.").
The noble Lord said: My Lords, I do not intend to move this amendment because I believe that this has been dealt with amicably with amendments of the Minister earlier on.
[Amendment No. 21 not moved.]
5.55 p.m.
Lord Campbell of Croymoved Amendment No. 22:
Page 7, line 7, after ("home") insert ("except where the re-siting is for the purpose of carrying out essential work to the site or for re-development").
The noble Lord said: My Lords, I beg leave to move Amendment No. 22. I wonder whether the provisions in this part of the Bill have fully taken into account situations where improvements of site are to be carried out. I move this amendment to indicate that there could be some doubt and misunderstanding about this. I think that everyone concerned is in favour of improvement of sites where this is necessary, or can be done, and where the owner is proposing to carry out such improvement. But during the process of redevelopment of a mobile home site it is not always possible to accommodate occupiers on broadly comparable land when they have to be moved. If there were strict enforcement of the proposed terms of this part of the Bill, the desirable or necessary development of a site might be held up, or made difficult, to the detriment of both the owners and the occupiers.
It could also be possible that sites would not be approved even though local authorities were requiring such improvement. If my noble friend is satisfied that the wording here covers those situations, of course I shall be content. I believe that these improvements would very often be carried out with the occupier's agreement. I hope that the Government will consider whether there should be something in the Bill on the lines of my amendment to cover the situation. I beg to move.
Lord Bellwin: My Lords, I think that the Bill covers this, but it would help my noble friend if I were to say why I think so. The Bill at present provides that if an agreement allows a site owner to resite a mobile home elsewhere on the site the new location must be "broadly comparable". This sub-paragraph re-enacts an important provision in the 1975 Act with two minor changes. First, the Bill does not use the earlier provision which enables an owner to move a home to another part of the site temporarily while essential works, say, are carried out, subject to reinstatement either in the same position or a reasonably equivalent one. And secondly, the Bill replaces the phrase "reasonably equivalent" with "broadly comparable". This sub-paragraph is designed to ensure that if a site owner has the right to re-station a mobile home, the occupier does not suffer as a result.
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It is surely right that occupiers should be able to live on a site that they have chosen, secure in the knowledge that if the owner does move them they will not be worse off. This amendment would remove the obligation to resite upon broadly comparable land, if the resiting were for the purpose of carrying out essential work or development. It would substantially weaken the protection offered to occupiers by this paragraph. It would enable site owners to move homes on site almost at will, perhaps to worse or smaller locations, if they claimed they were carrying out essential work or redeveloping the site. It is not hard to imagine a situation in which an unscrupulous site owner could move homes around without good reason on one or other of these pretexts. It seems to me right that if a mobile home has to be moved—and it will usually be in the interests of the site owner that the move is made—the move should be to a "broadly comparable position".
There may be occasions when a site owner is forced to resite a mobile home in order to comply with regulations imposed by the local authority. But if he thinks the requirement is unreasonable, he should contest it with the local authority, not penalise the occupier. As I said, I am not aware that this paragraph, which re-enacts a provision of the 1975 Act, has caused problems. I wonder, therefore, whether my noble friend will feel able to withdraw this amendment.
Lord Campbell of Croy: My Lords, I am grateful to my noble friend for what he has said. I think everyone in all parts of your Lordships' House agrees with the principle of this part of the Bill to which he drew attention just now. The only question that arises is as to whether an improvement would actually be held up or prevented. I certainly would not wish to give to any unscrupulous owner any kind of provision to enable him to do what my noble friend suggests. and therefore I realise that the wording of my amendment could be defective in that respect. Having made the point, and hoping that the Government will bear it in mind, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
6 p.m.
Lord Campbell of Croymoved Amendment No. 23:
Page 7, line 8, leave out ("incurred in consequence of the requirement") and insert ("of the removal of the mobile home to other land").
The noble Lord said: My Lords, a simple point is raised here. The amendment seeks to ensure that there would be excluded from the costs and expenses to be borne by the owner any charges which should properly be paid by the occupier. As the passage is worded in the Bill at present, it is not clear that that distinction would be made. I beg to move.
Lord Bellwin: My Lords, the Bill provides that, if an agreement enables a site owner to resite a mobile home elsewhere on the site, the costs of that move must be paid by the owner. The costs of moving involve not only the physical moving of the mobile home from one pitch to another, but also the costs of reconnecting essential services such as water, sewerage and so on. The 1975 Act required a site owner to reconnect services. It did not specifically provide for him to meet

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the costs of doing so, though I think it reasonable to say that a court might well have held that such a provision was implied into the wording of the 1975 Act.
The amendment would, however, ensure that a site owner was liable only for the cost of the removal of the mobile home to another pitch. The cost of reconnection of services would fall upon the occupier. I do not believe that that is acceptable or is what my noble friend has in mind. It would be inequitable for an occupier to be worse off as a result of a move which had been initiated by the owner and which he had not asked for. If the site owner requires the move, he should pay for it.
In practice, of course, what is likely to happen is that a site owner will seek to offset the costs of restationing mobile homes by increasing pitch fees for all occupiers on the site. That effect is not, I think, unacceptable. If a mobile home is moved in the interests of the site as a whole—perhaps to carry out essential works as part of a redevelopment scheme—then the site as a whole should benefit and it is reasonable to expect the occupiers, as a whole, to pay for it. What is not reasonable is that a significant part of the cost should fall on an individual occupier, especially when he may not particularly want his mobile home moved. I am confident that my noble friend will read my remarks carefully and take the equity of the point. Accordingly, I hope he will withdraw the amendment.
Lord Campbell of Croy: My Lords, again, I am grateful to my noble friend for those comments and, again, I am the first to agree that the drafting of my amendment probably fails to meet the situation I described. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Bishopston Lord Bishopston moved Amendment No. 24:
Page 7, line 9, at end insert£—
("Service charges
11.—(1) If the occupier requests the owner in writing to supply him with a written summary of the costs incurred by the owner in respect of services available on the protected site in the relevant period defined in sub-paragraph (4) below, the owner shall do so within six months of the end of the period or within one month of the request, whichever is the later.
(2) The summary shall set out these costs in a way showing how they are or will be reflected in the sums payable by the occupier and must be certified by a qualified accountant as in his opinion a fair summary complying with this requirement and as being sufficiently supported by accounts, receipts, and other documents which have been produced to him.
(3) The occupier may require the owner in writing to afford him facilities for inspecting the accounts, receipts, and other documents supporting the summary and for taking copies or extracts from them and the owner should then make reasonable facilities available to the occupier.
(4) The relevant period mentioned in sub-paragraph (1) above is—

(a) if the relevant accounts are made up for periods of 12 months, the last such period ending not later than the date of the request: and

(b) if none are made up for such a period, the period of 12 months ending with the request.

(5) In this paragraph "qualified accountant" has the same meaning as in Schedule 19 to the Housing Act 1980.")
The noble Lord said: My Lords, this is the final amendment of the day. We have gone through the
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amendments rather quickly, but I hope we may return to some of them later. They are all of great importance to the occupiers of mobile homes, who, as I said earlier, represent a not insignificant percentage of the population. We are speaking in the main of permanent homes, not holiday caravans where one can endure a situation for a week or so before deciding not to go again. These are homes in which people live and many expect them to be their final homes.
We believe that the amendment, which concerns charges and the right to information, is very important indeed. It is in relation to the part of the schedule concerning the re-siting of mobile homes, and I quote the first part of it to stress its importance:
"If the occupier requests the owner in writing to supply him with a written summary of the costs incurred by the owner in respect of services available on the protected site in the relevant period defined in sub-paragraph (4) below, the owner shall do so within six months of the end of the period or within one month of the request, whichever is the later."
We are saying that the occupier has a right to know about the charges being imposed by the site owner, including electricity, gas and amenity charges, charges for looking after the site and other charges. If the site operator is asking the mobile home owner to pay certain charges, surely the occupier has a right to have certified accounts. The amendment gives the occupier rights to information about service charges. That information may also be needed by the court or arbitrator; if they do not have that information, how can they do justice to those who appear before them? There is a growing awareness of the need of residents for this sort of information. The amendment draws on Schedule 19—perhaps I should not say that too loudly—to the Housing Act 1980, which gives leaseholders this kind of information. Further, paragraph 8.1.7 of the relevant DoE report concluded:
"In addition, residents should have a right to certain information about the costs of service analagous to those already enjoyed by private tenants and leaseholders".
Surely the Minister will not say that other people, living in different forms of housing, should not have a right to this information—how much they pay for electricity, gas and other charges—so they can see whether the charges are fair. After all, some site owners can get an enormous profit in various ways, as I said earlier, apart from saying that the van is old and needs replacement. The site owner can in those circumstances buy the home at his price and make a jolly good profit on the sale of a new one. In all those ways the occupier is subject to the site owner's pressures. The amendment provides merely for a written summary of costs, certified by an accountant and supported by receipts, and the occupier would also be entitled to inspection facilities. If one is being asked to pay a bill, one should have a right to ask how that bill is made up. I should have thought that that was the minimum we could expect.
The Bill would be strengthened by the inclusion of the amendment. If, as the Government indicated in Committee, an amendment similar to this would go too far, they should introduce their own amendment to give these rights to information about service charges. Justice must support the amendment and I hope the Minister will either say he accepts it or will undertake to give the matter further thought between now and the next stage of the Bill.
Lord Evans of Claughton: My Lords, the amendment would and should fill a gap which now exists in the Bill. Perhaps the words may not completely satisfy the Government, as the noble Lord, Lord Bishopston, said, but I should have thought that they would accept the principle of the words and introduce an amendment of their own at a later stage to give this kind of right to information to occupiers.
I recall, as I am sure the Minister does, spending hours discussing the trying problem of service charges and how to give people the information they need. One thinks of the number of Bills that have been before this House and another place trying to deal with the problem of service charges, particularly in London flats. Perhaps the problem is not of the same depth in the case of mobile homes, but in many cases the vans are the main homes of the people concerned, not just temporary holiday homes, and I should have thought that anyone who, either perforce or because he chooses, lives in a mobile home as his principal residence or as his main place of abode would be entitled to very full information about any charges the site owner is imposing, both so that the information is available so that he or someone on his behalf can check it, and, frankly, so as to keep fairly close control on site owners, who may in certain cases be tempted (who knows?) to exaggerate a little the charges they are making.
I feel strongly that the Government should either accept the amendment or undertake to introduce one which would give these people the kind of rights the Government have rightly given tenants—council tenants and lessees—in other legislation. I hope they will give a favourable reply on the amendment.
Baroness Ewart-Biggs: My Lords, I wish to support what the noble Lord has just said. To me the major aim of the amendment is to bring the rights of mobile home dwellers closer into line with the rights already enjoyed by private tenants and leaseholders, and that seems entirely appropriate. The reasons why people, especially young couples and elderly couples, choose to live in mobile homes are not going to change. They cannot afford a mortgage; they do not want to become yet another name on an endless council housing list. Surely anything to balance the rights of mobile home dwellers with those of people who live in ordinary houses should be supported.
On this point I wish to remind the Minister of something that he said during the Committee stage, when he referred to the 1975 Act. He said that he only wished that someone at that time had tried to anticipate the things to which our attention was being drawn. I think that the Minister was quite right. But I only hope that in 10 years' time the Minister's successors will not be using the very same words when referring to the imperfections that we have, sometimes vainly, been trying to draw to his attention today.
Lord Bellwin: My Lords, the question really turns on the extent to which it is fair to compare. The fact is that the amendment would go much wider than Schedule 19 to the Housing Act 1980. It would require site owners to provide summaries of costs, irrespective of whether pitch fees are related to the cost of the services. When this matter was raised at Committee
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stage, I drew attention to the dangers of comparing the position of mobile home occupiers and tenants of flats. I do not believe that there is a valid comparison between the two. My understanding is that pitch fees are normally inclusive of services. They are normally all paid in one sum, and there is normally no provision in the agreement for the inclusive fee to be related to service costs. The amendment would, therefore, place an obligation on the site owner which could significantly affect the way that he keeps his accounts, but which would not be material to the agreement that he has with the occupier. Unless the agreement itself restricted increases in the pitch fee to increases in costs borne by the owner—and it is most unlikely that that would be the case—it would not be of any use to an occupier to have access to greater information about the costs.
As I have previously mentioned, an occupier is quite entitled to challenge the agreement that he is offered if he considers that it does not provide enough information about the yearly review of the sums payable by him, or the provision of services available on the site. Those are matters which agreements must cover. I recall that at Committee stage the noble Lord, Lord Avebury, was particularly concerned that occupiers did not have enough information about their electricity charges, for example. Where electricity is one of the services provided on site, there is nothing to prevent an occupier from asking that his agreement should include satisfactory terms about the charges to be made for it, including, for example, a reference to the maximum rates which the area electricity boards set for the resale of electricity. I do not think that the amendment is any more relevant or necessary now than it was when we discussed it in Committee.
When the noble Baroness, Lady Ewart-Biggs, reminds me of the importance of having a balance in regard to what is right on both sides, I should like to remind her that in regard to a previous amendment I told my noble friend Lord Campbell of Croy why I felt that it would be wrong to accept his amendment. That was because it would swing the balance in favour of the site owner, whereas we were trying as hard as we could to maintain the fairest possible balance all round. I think that that is what we are doing throughout the whole of the Bill, and that applies to the present amendment.
Lord Bishopston: My Lords, the amendment deserves much more time than it is to be given today, and I hope that we can come back to it again, or that at least it will be considered later. Surely the Minister is treating mobile home occupiers as second-rate people, because he is not giving to them the kind of rights that are afforded under the Housing Acts to other tenants, and that is really quite unjustified. Surely in matters of the resale of electricity the prices charged should be what one might call the current prices. It is possible for the site owner to buy electricity at one price and to sell it at a much greater price, and at an unjustified profit, to the occupiers of mobile homes, who as we have said are mainly elderly people. In fact the elderly, and young people with families, represent the majority of the type of people living in mobile homes.
If the Minister is saying that the legislation is fair in

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so far as the rents can be demanded on the basis of being fair, I would ask: how does one know that they are fair when it is not known how the charges are made up? How do the court and the arbitrator, who have to assess whether the rent demanded is fair, know what is justified if they do not know how the bills are made up? Surely the occupiers have a right to this kind of information. As I said, the Minister's own DoE report concluded that residents should have a right to certain information about costs of services and so forth. I do not intend to press the amendment now, but I hope that the Minister will look at it in the wider context of the powers of the owner and the court generally.
Lord Bellwin: My Lords, before the noble Lord sits down, and with the leave of the House, I should like to make perhaps a last comment at this stage. It is most unreasonable for the noble Lord to say that the Bill attempts to treat mobile home occupiers as second-class citizens. If that were the case, the Bill would not have been produced. I should like to remind the noble Lord that in 1975 it was not his Government who produced a Bill to deal with mobile home occupiers. Everything that I have said throughout all the stages of the Bill, and on all the amendments, has been in an attempt to show how we are trying to hold a fair and reasonable balance, not least on behalf of the occupiers. That is what we have done, that is what we shall go on doing, and I do not accept what the noble Lord says as to that.
Lord Bishopston: My Lords, I should like to clarify the position. I am not saying that the Government are treating these people in a second-class way. I said just now that I supported the Government, and I praised them for bringing forward the legislation, but bearing that in mind, as well as the fact that we are trying to improve the legislation, I should not like that kind of accusation to go out. It is important that we close as many loopholes as possible. I believe that the Bill has had the support of noble Lords in all parts of the House, and we have been constructive, as well as brief, in our attempts to help the Government to produce a Bill that will be worthy of the job that they are seeking to do. With those comments, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.

Agricultural Marketing Bill
6.17 p.m.
The Minister of State, Ministry of Agriculture, Fisheries and Food (Earl Ferrers): My Lords, I beg to move that the Bill be read a second time. I am glad to see that the Bill is to be the vehicle by which the noble Lord, Lord Northbourne, will make his maiden speech, and we much look forward to hearing what he has to say. The Bill represents the culmination of a lengthy and constructive debate which has taken place within the agricultural and food industries in recent years, on the importance of improving the marketing of our produce—both on our own market and abroad. The Bill seeks to establish the framework within which improvements in marketing can take place.
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Among our producers and manufacturers there has been a growing recognition that it is no longer enough simply to be efficient at producing. Production is not an end in itself. If the product does not sell, then the producer, the processor, the retailer—none of them will be rewarded. They are all interdependent upon one another.
The record of agricultural productivity in this country is one of considerable achievement. Our food industry, as well, has achieved a high degree of efficiency, and the efficiency of our food distribution trade is second to none. But we cannot stand still. Industries in other countries are also highly efficient. and they are looking to an expansion of their markets. The free exchange of agricultural produce within the Community, the advances of modern technology which allow rapid transport of perishable foods which never used to happen in the past, and the increasing sophistication of consumer demand for food—all those factors mean that even greater account must be taken of what the market wants. That means producing exactly the type of produce which is demanded by the market. It means making sure that the quality product gets the reputation which it deserves, and it means that the consumer must be made aware of its availability, of its reliability, and of its value for money.
To achieve that requires very effective communication between the industry on the one hand and the consumer on the other. That means co-operation between producers, processors, wholesalers. manufacturers, distributors and retailers—all those who are links in the chain from the producer to the consumer.
We have already seen a number of initiatives being taken to improve the marketing of our home-grown produce. The Kingdom Cox campaign set out to improve the grading and the organisation of apple supplies. It has achieved substantially higher sales of the English Cox apple. The Charter Bacon Scheme aims to achieve quality and consistency of supply of British bacon. The "Great Brits" promotion of premium grade potatoes is beginning to prove its worth in its test market in Scotland.
Among the many initiatives which have been helped by the Central Council for Agricultural and Horticultural Co-operation, we have seen: the launch of Puffin new potatoes; Froqual frozen vegetables; the first appearance of British frozen lamb to help producers extend the marketing season for home-produced lamb; the remarkable achievement of Grampian Pig Producers in creating new markets for their produce in close collaboration with the trade; and the promotion of English fresh vegetables in West Germany.
In November last year, we saw what an impact could be made at the major French food fair, SIAL, by the co-ordinated efforts of a number of fresh produce sectors—milk, meat and vegetables—working in conjunction with the British Food Export Council to present a showcase of high quality British food products. It was an impressive achievement.
All these activities indicate a willingness on the part of producers and manufacturers to pool their efforts to achieve better results on the market. But, unlike our European counterparts, no single body exists in this

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country to bring together marketing expertise across a number of sectors in joint initiatives. The Central Council for Agricultural and Horticultural Cooperation has done wonderful work in encouraging better marketing in the co-operative sector, but its scope, as its name implies, has necessarily been limited to co-operatives alone, and therefore to basic agricultural and horticultural produce.
The United Kingdom is one of the last of the major food-producing countries to seek to organise itself in this sphere. In France, there is SOPEXA; in Germany, the CMA; and the Danes, the Dutch and the Italians all have their own organisations aimed at improving the co-ordination of marketing efforts at home and abroad. In this, Britain lags behind. I hope that the Bill now before the House will remedy that position.
Following much discussion within the agriculture and food industry, the Government are proposing in this Bill to establish a central marketing organisation for agriculture and food which has as its objective the improvement of the marketing of our food and agricultural produce—both at home and abroad. We propose to call the new organisation Food from Britain. Our intention is to build Food from Britain on the basis of the existing Central Council for Agricultural and Horticultural Co-operation, and therefore to develop fully the marketing expertise which the Central Council has acquired over the years. But Food from Britain's remit will go much wider than that of the Central Council. It will bring together in a single forum all parts of the agricultural and food industries to work towards the common objective of improving our marketing performance.
In the long run, we see Food from Britain as an industry organisation, run and financed by the industry which it serves. But the Government recognise the importance of giving Food from Britain an effective start. We intend, therefore, to see the organisation properly financed from the outset on a scale sufficient to launch it on a proper basis. The Government will provide pump-priming funds for the first five years, in order to help Food from Britain establish itself and reach full operation. In total, up to £14 million will be made available in the period 1983–84 to 1987–88 inclusive for new marketing initiatives. The money will be paid as grant-in-aid.
The support of the food and agriculture industries is crucial to the success of this venture. The Government will be financing the greater part of Food from Britain's marketing budget at the outset, but the Government's contribution will reduce as these industries contribute on increasing scale. Industry contributions will be voluntary, by such means as subscriptions, contributions to joint projects, and payments for services. By the end of the five-year period, we envisage that the full marketing budget of Food from Britain will be provided by industry. The success of Food from Britain will depend on its ability to convince the agriculture and food industries that its services are worthwhile. And this is as it should be.
Food from Britain will continue to support and to encourage co-operative development in exactly the same way as the Central Council for Agricultural and Horticultural Co-operation now does. The Government financial support for co-operative activities will
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continue, as now, at a rate of some £1½ million per year, and co-operative grants which now total about £3 million to £4 million per year will also continue unchanged. Nothing in the Bill which is now before the House in any way diminishes the commitment of the Government to the co-operative sector. Indeed. we believe that co-operatives will stand to gain from the bringing together of marketing and co-operative development within a single new organisation.
Perhaps I may refer briefly to the provisions of the Bill. Clause 1, together with Schedule 1, sets up Food from Britain and gives it a council of 13 to 15 members. The Government are proposing a small, effective council for Food from Britain because it will be concerned with marketing throughout the food chain. A body which consisted of representatives of every sector and region would, in our view, be too large to work effectively. In making their appointments to the council, the agriculture Ministers will have regard to all sectors of the food and agricultural industry throughout the United Kingdom.
Clause 2 transfers to Food from Britain the present functions of the Central Council, which are to improve and develop co-operation. The details of these functions remain enshrined in the Agriculture Act 1967 and in no way have been changed or diminished. It also gives Food from Britain powers to co-ordinate and to develop marketing in the widest sense in the areas of agriculture, horticulture, fish (other than fresh sea fish, which is dealt with by the Sea Fish Industry Authority) and food produce. The powers are deliberately given wide definition so that Food from Britain has maximum scope to develop and implement a flexible strategy. We hope, therefore, that in time Food from Britain will co-ordinate market research; act as a forum to achieve more coherent marketing within and between sectors; encourage better quality and presentation of produce; promote joint ventures; provide advice and information; and, above all, concentrate upon the priorities of quality, consistency and value for money.
Clause 3, with Schedule 2, provides for the dissolution of the Central Council for Agricultural and Horticultural Co-operation, and for the transfer of all its rights, obligations and property to Food from Britain. Clause 4 enables statutory bodies in the agricultural field to contribute towards the cost of the marketing activities of Food from Britain, if they so wish. Clause 5 lays down standard requirements which apply to any non-Crown body for accounting records and preparation of an annual report. Clause 6 gives Food from Britain powers to borrow temporarily up to £500,000, a provision which is intended to cover short-term cash flow problems only. The clause also enables Food from Britain to make grants or loans.
Clause 7 will enable Ministers to make grants and loans to Food from Britain and to remunerate the members of the council as appropriate. I should add that funding by the Government of co-operative functions will continue to be provided for in Section 58(9) of the Agriculture Act 1967. Clause 8 deals with the interpretation of various terms used in the Bill. Clause 9 names the Act, provides for it to cover Northern Ireland and provides for repeals in Schedule 3 which are mainly consequential on the transformation of the Central Council for Agricultural

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and Horticultural Co-operation. The clause also makes provision for the coming into force of the Bill by statutory instrument. It is intended to do this two weeks after the Bill receives Royal Assent, in order to set Food from Britain in full operation as soon as possible.
I very much hope that the Bill will receive the support of your Lordships. It reflects the Government's view that there is a very great deal to achieve in the better marketing of our food and agricultural products—an achievement which will be available for the producer, the manufacturer, the retailer and the consumer. It demonstrates our belief that British produce can develop overseas markets and can achieve a reputation for quality, variety and consistency of supply for which it should be well noted. Food from Britain can provide the framework by which this can be done and the results will be a stronger and more effective marketing performance by our industry in the coming years. I beg to move that the Bill be now read a second time.
Moved, That the Bill be now read a second time—(Earl Ferrers.)
6.30 p.m.
Lord John-Mackie: My Lords, in opening for the Opposition on this Bill, I too should like to say that we are looking forward to hearing the maiden speech of the noble Lord, Lord Northbourne. The noble Lord, like his father, is looking to the land. His father not only looked to the land but wrote about it. He was also a very prominent member of the agricultural war committee in his native county. We look forward to hearing from the noble Lord and for his experience to be made available to this House.
The noble Earl, Lord Ferrers, in his usual crisp and clear way, has put forward the reasons for the Bill. He has gone over the whole gamut of what is there now and has put it to us that the co-ordination of all these functions is the main object of this bill. I could not agree with him more. I welcome the Bill although it has taken a long time to reach this stage. The Minister admits that he started looking at this matter in 1979, and by about the middle of that year he brought together four or five people to study the situation. Now here we are, three weeks into 1983, having it launched. The Bill should be good with all the deliberations that have gone on in that time.
There were inklings of it at the Oxford farming conference in 1981 when one of the Minister's advisers, Miss Detta O'Cathain, gave an excellent paper. We all thought that the Bill would be coming fairly soon. That was two years ago and the Bill is not yet on the statute book. The problem with the designated committee which we have at the present moment is that it is running into spots of trouble. I shall not mention them. I do not think that a director has been appointed yet. Some members of the NFU are making criticisms. I trust that will be sorted out before 16th February, when we are to meet on the launching of this Bill.
Looking at the Bill, we see that it gives power to the Food from Britain organisation to develop and coordinate the marketing of agricultural and food produce at home and abroad and to take over the
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Central Council for Agricultural and Horticultural Co-operation. Having seen that body (the CCAHC) on to the statute book as a junior Minister in 1967, I am glad to see that the Minister of State in another place, in the Second Reading speech there of this Bill, envisages a strong role for it under an almost autonomous body, so far as one can gather from what he said, called a co-operative development board with its own chairman from the main council. I welcome this very much because it is essential to make full use of all the expertise of the CCAHC.
The other point on which the Minister is to be congratulated is on not having nominated or statutory members. I have been a member of, and chaired, many bodies that had statutory members. There is no doubt that many are very good; but too often it is just "Buggins' turn" from the parent body. One usually gets a number of people who are just simply filling in a space. I think that it is an excellent idea that there is to be no nomination of statutory people on this body. The Scottish NFU wants more consultation, but that should be all. I doubt whether Douglas Cargill, the chairman-designate, would have obtained the job if he had been a nominee of the NFU, although they consider him a good choice. He has great experience in co-operatives in the North-East of Scotland. He is a founder member of Grampian Pig Producers, a body which took over when the bacon factory closed down in Aberdeen. That has been a huge success. He is a past chairman of Grampian Growers, a body that deals with a tremendous amount of bulbs, flowers, potatoes, and so on from that area. That would make him, as the Minister of State suggests, a first-class chairman of the development board, the successor to the CCAHC, within the Food from Britain organisation. This should satisfy many of my noble friends who are worried about the position of the council. Mr. Cargill happens to be a cousin of my wife. which I would suggest is a recommendation as well.
My noble friend Lord Blease, because of commitments in Northern Ireland, is unable to be here today but hopes to take part in other stages of the Bill. In a note to me he states that in general terms the Bill is welcomed by the Ulster farming community. It is hoped that the already well-developed agricultural marketing provisions in the Province will be further improved and strengthened by the Food from Britain measure. However, apart from the vital questions concerning effective liaison and Northern Ireland representation on a new Food from Britain Council, other important matters regarding Northern Ireland agricultural interests require to be clarified. For example: will Northern Ireland food producers still be able to market Ulster butter, milk, bacon, eggs, potatoes or other agricultural products under their own labels where these are well established, or will all these become swallowed up in the proposed new marketing operation? I hope that when the noble Earl comes to reply he will be able to assure my noble friend Lord Blease that the latter is not the case.
Now let me make a few points about the present situation. We are producing today at farm gate prices over £10,000 million worth of temperate foods. This is about 75 per cent. of our needs. So over £3,000 million more has to be produced to become self-sufficient. I shall not attempt to forecast whether this

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can be done; but when one remembers that in the mid-1960s we were producing only 13 million tonnes of grain, and today we are well on our way to producing 23 million tonnes, one wonders how much food we can produce in this country if we carry on at that increase. However, we export round about £3,400 million worth of food and drink, of which only about £2,200 million is food. There is an enormous export of Scotch whisky which takes about £900 million of the main figure. All that food has to be replaced by buying food over and above the 25 per cent. shortfall that I have just mentioned. Although the Food from Britain campaign is pushing home-produced food, it is getting considerable publicity in that it has to sell a lot more abroad. It has to be remembered that the more we sell abroad, the more we have to buy to bring up our supplies to satisfy 100 per cent. needs.
According to the noble Lord's Ministry, from which I received some figures, more than 50 per cent. of the cost of food to the consumer is in processing, packing, distribution, retailing, et cetera. So we are really speaking of about £1,000 million worth of food at farm gate prices, or maybe slightly less than that which is to be exported. This means that nine-tenths of food production is sold at home. Even suppose Food from Britain succeeds in doubling our exports, it still means that far the biggest job that it will have to do will be to market the home sales of £8,000 to £9,000 million worth. I note that the Bill does put home food first and export afterwards.
I gather from the Food Processors' Federation that more than 50 per cent.—and it is a very high figure which I was unwilling to believe when I heard it—of home-produced food reaches the consumer in processed form. This puts 50 per cent. more on to the price before it reaches the consumer. That is called "added value". I have always been suspicious of that expression because I feel it is often only added expense. If one takes potatoes, for example, I have looked at potatoes which are sold in the supermarket, nicely washed and in a polythene bag, and then I have gone and brought 561bs. in a paper bag fresh off the farm. You will find that if you take the 2 cwt. plus that each individual in Britain eats in a year, they are paying to have them washed and put into polythene bags, and it comes to £7 or £8 more. Of course I know that potatoes are not always sold in that way. Root vegetables in particular do not keep so well after they are washed, and I think that we should be teaching housewives to buy them, as far as possible, in the state in which they come off the farm. The point I am really emphasising is that if Food from Britain is to give real help to home producers, then they have to concentrate on what is sold at home. I appreciate that consumers, processors and, of course, the economy come into the picture as well but, as the noble Earl said, none of these will benefit unless the production is there.
Over 50 years ago, in the very early 'thirties, I was often frustrated by not being able to sell my produce. I had printed some notepaper with a heading, which also appeared on the back of the envelope: "Buy British Farm Produce". That was in very large print. Some people wrote and asked whether there was a body they could join; a lot of people laughed at me, and nobody wrote wanting to buy anything; but I felt I might be sowing a seed that could germinate some
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day. Therefore I am only too pleased to support this Bill. It may help to answer my plea which was made over 50 years ago.
6.42 p.m.
Lord Tanlaw: My Lords, I should like to thank the noble Earl, Lord Ferrers, for his presention of this Bill which will, we hope, become a very useful one. Like the noble Lord, Lord John-Mackie, and the noble Earl, I am looking forward very much to the maiden speech of the noble Lord, Lord Northbourne, and to hearing his expertise on this subject. My noble friend Lord Mackie of Benshie is unable to be present today but I know he would be particularly interested to take up the point which was made by the noble Lord, Lord John-Mackie, about potatoes. I have no doubt he was right in what he said, although my own technical knowledge of that subject is small.
It is said sometimes that quangos come and quangos go; that there are good quangos and had quangos; and there are some that change their spots. The latter kind is what we have in this Bill—one that changes its spots. The Central Council for Agricultural and Horticultural Co-operation changes into Food from Britain. It is also true to say that this transformation has provided "teeth" for the first time for the council. In Clause 2 of the Bill, the functions of the central council are not only transferred but given extra powers in that Food from Britain may undertake activities to develop and co-ordinate the marketing of agriculture and food produce. It is this part of the Bill that I welcome very greatly and have great hopes for, along the lines which were explained by the noble Earl in his presentation of the Bill this evening.
If there is any criticism, or clarification to be made by the noble Earl in his winding-up speech, I would hope that not too much emphasis is put on promotion. in the terms that he has described. Of course it is essential, if it is to be a successful marketing operation, but not promotion without the proper guarantees of quality control and really positive attempts by the Government or by the Food from Britain Council to establish criteria and quality which are agreed with the distributors and the markets as a whole and which will ultimately benefit the consumer. I think this is a very important and significant Bill for producers, like myself—if I may take this opportunity to declare my interest as a producer of Scottish beef and hill lamb.
It is very important that Food from Britain has clearly stated objectives, which at the moment I am not clear about, but no doubt they will emerge during the Committee stage. Both as regards home and overseas markets, these objectives should he defined and should include the quality standards which I have mentioned. These must be maintained and fulfilled before Food from Britain will go as far as promoting it. I feel that a blanket promotion simply to promote food which is produced in Britain could do considerable harm to the producers in this country, especially if bad food came under the umbrella of this marketing procedure.
There is no need for me to remind the House. as has the noble Earl, of the success of some marketing programmes. The noble Earl mentioned the British ones, but there are also successful imported ones, and

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we have been on the receiving end of those. There have been campaigns for New Zealand lamb and Danish bacon. The point I wish to make here concerns the maintenance of recognised standards of quality which they adhere to, and the consistency of the product. If we do not learn from their experience, I am afraid we are going to fail. Tonight I am only interested in talking about Scottish beef; but whether it is apples, lamb or anything else, if we do not stick to these points, I have a feeling that there will he great disappointment from everyone connected with this project.
The only aspect I should like to select this evening is just one example of the many areas in which Food from Britain is going to assist in terms of marketing and which will, I hope, benefit from the new powers given in Clause 2 of the Bill. It is, of course, the need to improve production of beef—in this particular case, Scottish beef—in much the same way as improvements in quality have affected the pig trade in, for example, the reduction of back fat over the last 20 years.
I am sure that your Lordships will forgive me if I say—many of you will be experts in this matter—that there are different types of beef. I may say that Scottish beef is basically a suckler beef which takes 18 to 20 months to produce from cows and calves fed on nothing but grass. Then there is barley beef, on the other hand, which means that the animals are intensely fed indoors and receive little exercise to speak of in order to maximise the increase in weight. That kind of beef is produced in only 12 months. Then there is English beef which is calved on the dairy farms and is fed on a mixture of grass, cake and milk.
So there are three different types of beef which, possibly, I have described very badly; but when it comes to marketing, the housewife does not have much indentification as to the feeding patterns of the meat she is buying from the butcher. I should like to make the point, because of my declared interest, that those of us who work the most difficult parts of Britain— in the hill and upland areas—have beef which takes 18 to 20 months to mature. On the other hand, they are getting the finest diet, a natural diet of grass. There is no forced feeding or unnecessary fat; but we do not get any extra price for this quality. I mention this because another report, which has been brought out by the Royal College of Physicians, says that fat meat is bad for us. I hope to develop this point during the debate which my noble friend will introduce into your Lordships' House next month.
The point I am making is that the three different types of beef are not classified. There is no definition of "Scottish beef". We know it is the best and finest in the world, and yet there is no definition of it so that we can, as a co-operative of producers, maintain the standards to get a better price in the markets.
I also draw the attention of the noble Earl to the report of the West of Scotland Agricultural College, entitled Auction Markets: Fat Cattle Sales. It is the No. 3 Report. This is an area in regard to which they have said, quite clearly, that the auction markets do not have any grading system for those of us who produce beef. They say that it is quite possible for the auction markets to make a grading on visual grounds alone,
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between over-fat animals and those of lean and good consistency, and also between those which have been fed on grass and those which have been fed on barley. They say that this would be beneficial for the market, but I am not sure whether it would for the buyers, because, at the moment, the heavier the carcase the bigger the price. So there is no incentive for the producers of beef to concentrate on quality beef.
I hope that this is a factor which will be taken into account in this new Bill and in these new powers that are available. The information is available—certainly, if we talk in terms of Scottish beef—and I have a feeling that now, for the first time, this can actually be implemented. One of the reasons why it has not been implemented before is this: Why should the auctioneers carry the burden and trouble of the extra cost of grading? But there are funds now available to put this right.
I think also that, for instance, there should be a marking on the carcase of Scottish beef calves for slaughter, which would indicate to the end-consumer that it is beef that has been grown on grass, rather than on barley, or that there should be a quality label attached to it. The new Food from Britain organisation could do a lot to educate butchers. Why do the butchers not clearly indicate on the meat on their counters that which is grown from grass, that which is grown from barley or that which is force-fed? I believe that people would be willing to pay extra for quality and they want to know. The quality is made quite clear in other products.
I also believe that producers' co-operatives should begin to be formed. Those of us who work on hill farms should co-operate together, in order to produce the kind of animal that is wanted for the market. It is the only business of which I know where we are working together to produce for the market, but have no idea what the market wants. Very roughly, we take our chance on the mood of the buyers on the day. The objectives behind, and definition of, the beast that we are trying to produce are not before us.
These are just some of the points that I hope will be taken into consideration by the Government. I am not asking them to do all the work on this. I am asking them to give some real incentives to the markets, to those of us who produce and to the breeders to fulfil the objectives which the noble Earl has put forward. On the other side of the coin, if support is not forthcoming—I have given the example of the Scottish beef campaign—if the Government are not, in the next five years, going to assist auctioneers and auction markets in. for example, Scotland, to improve the quality and grade the stock that is coming up for sale, and if they are not going to have representation on the Food from Britain board, or board of directors or whatever they will have, by men who are competent to put forward the ideas that I have expressed, of maintaining the quality and the name of Scottish beef, then it will be a tragedy.
Certainly, there will be no support whatsoever from the industry to pay a penny towards any organisation that does not do the least of the things which I have described. I have no doubt that, when he replies, the noble Earl will say, "Of course this is something that is bound to happen". If so, the industry, whether it be

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the producers, the meat buyers or the butchers, will welcome this Bill and will be happy to support something which is in their interests, right down the line from the producer to the consumer.
6.55 p.m.
Lord Northbourne: My Lords, I must ask your Lordships' indulgence for my maiden speech. I should like to thank you for the kind welcome which you have already given me and I should particularly like to thank the noble Lord, Lord John-Mackie, for the very kind remarks that he made about my father. As the son of a distinguished farming father, I am rather proud to be able to make my first speech in your Lordships' House on an agricultural subject. I have to declare an interest, in that I am the managing director of a substantial farming business and our most important activity is growing, packing and marketing vegetables.
The need for this Bill is emphasised by the existence of a world surplus of almost all major agricultural commodities. British food production is increasing and British food consumption is static. It is, perhaps, interesting that the French housewife spends a much higher proportion of her income on food than her British counterpart. I have personally been able to avoid any inconvenience on this score by marrying a French wife, but the problem for the industry obviously remains.
I should like to touch on the matter of co-operatives in agricultural marketing. I know that the subject has been discussed at some length in another place. My remarks are not related to any kind of political view, but only to my own personal experience. I am a member of three agricultural co-operatives connected with marketing and for 10 years I was a director of one of them. My experience suggests that, although cooperatives have a very important role to play, they also have their limitations.
The success of a co-operative depends on the loyal support of its members, and members look to the cooperative to offer them a service. The very essence of good marketing is strict control of quality and regularity of supply, and the members of a cooperative are sometimes reluctant to accept the necessary disciplines for a fully effective marketing effort. For this reason, I believe it is difficult for a co-operative to have quite the same sharp, commercial cutting edge as an independent business which markets its own products.
I particularly welcome the fact that the whole food chain, and not just agricultural and horticultural produce, is covered by the provisions of this Bill. Unfortunately, traditionally, agriculture and the food industry have tended to develop along separate lines and, sometimes, in competition with one another.
In 1977, I was responsible for instigating a seminar at the Centre for European Agricultural Studies at Wye, which was entitled Europe as a Food Exporter. The main conclusion which came out of that seminar—and I believe it is equally true today and equally true for Britain—was that the greatest opportunities for increasing the export of agricultural and horticultural produce lie in the export of processed and prepared food.
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It is interesting to reflect that 100 years ago nearly all food was prepared either on the farm or in the kitchen. By contrast, today the vast majority of the food that we eat is factory processed. One noble Lord mentioned 50 per cent., but I suspect that even more than that is either processed or at least graded and packed. Noble Lords, who may recently have tried, for example, to buy an apple in a supermarket, may have been confronted by the problem that they had to buy four of them in a plastic tray, with a bit of plastic wrapping over them. I think that the noble Lord, Lord John-Mackie, had the same problem with his potatoes.
Today, the supply of raw materials for the food industry is one of the principal roles of the agricultural and horticultural industries, and the food industry can offer us new and useful outlets for our products. Indeed, not all such ideas are new. For example, I ask your Lordships once again to consider the humble potato which, when it is dressed up in fancy dress, sells as potato crisps to an enormous market. It has developed a major new outlet for potato producers. Similarly, I have always greatly admired the genius of the man who thought of taking anchovy and making it into Gentleman's Relish—and even giving it a Latin sub-title for good measure.
A great deal of what can be said about the Bill has already been said, and I therefore intend to be very brief. I should like finally to refer to Clause 8, which defines a number of terms used in the Bill but does not actually define the term "marketing". I suggest that marketing must not be seen just as packaging and promotion, although both have a part to play. The noble Lord, Lord Tanlaw, made this point. It simply is not good enough to shout "Buy British" if the product is not right or if the price is not right.
I suggest that good marketing is identifying specific products which the consumer wants, or which the consumer would want if they were available, then learning how to produce them at the right price and how to deliver them where they are wanted and when they are wanted, and to a reliable standard of quality, and only then making sure, through promotion, that the customer knows that the product is available. That is the kind of co-ordinated marketing which I hope Food from Britain will bring to the industry. If it succeeds, then an increasing number of customers will choose to buy British.
7.2 p.m.
Lord Sainsbury: My Lords, I consider it to be a privilege and a very great pleasure to be the first to congratulate the noble Lord, Lord Northbourne, on his excellent maiden speech. I am sure I speak for all quarters of the House when I say that, with his experience as a large producer and with his keen marketing sense, we all look forward to his future contributions when he speaks on agriculture and allied problems.
In welcoming the Agricultural Marketing Bill and congratulating the Minister of Agriculture, Fisheries and Food upon his initiative, I must of course declare an interest, since the firm with which my name is associated is obviously concerned. Also, one of my kinsmen was one of the five marketeers who were asked to assist the Ministry and the Government by examining the problems of the marketing of British agriculture and food products.

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We have in the United Kingdom food producers who compare favourably in efficiency with any in the world, but we have been less efficient in marketing. We have not always taken into sufficient consideration consumer choice and demand, probably because of the emphasis placed on price guarantees under the common agricultural policy, which has led farmers to concentrate upon securing volume of output.
What is good marketing? In my opinion, it is ensuring, first, as has already been stated, a high quality product with continuity of supply, properly graded, in good condition and packed in suitable containers—deciding whether the market requires a consumer pack or a bulk pack. There is a clear need to establish a realistic, commercially viable specification, and, if standards are established, they must be properly enforced. Retailers have, in the past, found that this is not always done satisfactorily. It is vital that the consumer does not lose confidence in the product.
Good marketing is not simply a public relations job of inventing a brand name and spending a large sum of money on television—although, of course, advertising has a role to play. There is obviously a need for an organisation that has the power to co-ordinate marketing efforts, such as the French and the Germans have. There is equally obviously a need to co-ordinate market research. In the export field, in my opinion, it is particularly important to make a study in depth of the market you want to penetrate before you start exporting there—something in which, in the manufacturing industries, the Japanese have excelled.
A very small proportion of the agricultural product that leaves the farm reaches the consumer in the state in which it left the farm gate. There are many links in the chain between the farm gate and the consumer's shopping basket. To take two obvious examples, milk is collected from the farm in tankers, pasteurised, bottled and delivered by the milkman to the housewife's doorstep. Peas may be grown under contract and, after harvesting, delivered to factories for freezing, canning or drying before they reach the wholesaler and retailer. It is probably true that there has been less co-operation and communication between the links in the chain of distribution in Britain than there has been with some of our overseas suppliers. The new organisation will have an important role to play in encouraging the dissemination of market information.
One of the great difficulties in marketing is predicting accurately future demand. Here the large retailer is in a good position from his experience to provide forecasts from which the producer can benefit as much as anybody. Of course it has always been easier for countries like Denmark, Holland and New Zealand to maintain high quality standards because such a large proportion of their total production went in export, and strict quality control could be exercised both at packing stations and at the point of shipment. Also, whereas we have been pioneers of co-operation in the retail field, until comparatively recently we have not developed on any great scale the producer marketing co-operatives. This is the exact opposite of what happened in the three countries I have just mentioned where producer co-operation brought the necessary discipline which is essential for good marketing.
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An example of a comparatively recent successful marketing co-operative in the United Kingdom is the East Lincolnshire Growers, which was formed in 1964. Its 36 members range from a rather small farm of 150 acres to a very large one of 7,500 acres. All their root and vegetable crops are marketed through the co-operative. They have learnt to grow for the market and their current turnover is, I understand, some £7 million a year. This is a real success story. The promotion of producer marketing co-operatives was no doubt given impetus by the formation in 1967 of the Central Council for Agricultural and Horticultural Co-operation. It is to be welcomed that the Bill transfers the functions of the council to the Food from Britain organisation.
There is one other matter in the Bill on which I should like to comment in the light of my experience of serving on many committees of the Ministry of Food and other bodies during the last war and afterwards. It concerns the size and composition of the council of Food from Britain. I believe that members of the council should be selected on the basis of their experience and the potential contribution that they can make as individuals—and not because they are the nominees of sectional interests. Once one starts appointing on a representative basis, the size of a council or board invariably grows to unmanageable proportions. Therefore, I fully support the Minister in his policy of not having nominated membership and the limitation on the size to 13 to 15 members.
May I conclude by wishing Food from Britain every success under its able young chairman, Nicholas Saphir. I have known members of his family for many years and they have great experience and a fine record in the marketing field.
7.13 p.m.
Lord Stodart of Leaston: My Lords, it was the custom in another place, as it is in your Lordships' House, for the speakers who follow a maiden speaker to compliment him and say that the House would join unanimously in hoping that the maiden speaker would be heard on many occasions in the future. I have known one or two of my former colleagues in another place say privately that they rather wish they had not uttered those words of hope that the new Member would be heard on many occasions thereafter. But on this occasion I will say only that the keen anticipation that was expressed about the maiden speech of the noble Lord, Lord Northbourne, has been succeeded by a feeling of all-round satisfaction.
I find this a particularly interesting debate because marketing and the idea of exporting food, especially to Europe, was all the rage when I held the same office as that of my noble friend Lord Ferrers precisely 10 years ago. I have looked up some of the answers I gave to supplementary questions in another place and see I said, among other things, that a firm of consultants was making a study with the Government paying 90 per cent. of the cost; that investigations were covering cheese, meat, soft fruits, vegetables and flour; that the Central Council for Agricultural and Horticultural Co-operation was in the closest touch with cooperatives in the Community; and best of all, perhaps, and the greatest pearl of wisdom, that the need to co-ordinate the export of agricultural produce was

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being actively explored. How right the poet Longfellow was to mention what he did about the "mills of God".
There has been a considerable change in thinking on food production in the United Kingdom over the past 10 years and for this my right honourable friend the Minister and my noble friend Lord Ferrers and his colleagues deserve hearty congratulations. Gone is the attitude voiced by the former Board of Trade when, in giving evidence to the Select Committee on Agriculture some 12 years ago, it decried import savings by increased food production at home as being of little or no value. The noble Lord, Lord John-Mackie, referred to the fact that 75 per cent. of our needs for temperate foods are now produced compared with 60 per cent. some 10 years ago. I suspect that about the only temperate foods in which we are not self-sufficient are sugar, dairy produce, lamb and possibly (I am not sure about this) beef. This is a stupendous performance in what is one of the more densely populated countries of the world, especially when two other factors are taken into account. The first is the area of land which goes out of production, which is running at more than 50,000 acres a year. If one works that out, it means that an area almost exactly equivalent to the county of Norfolk has disappeared from agricultural production since the war.
The second factor is that the labour force in agriculture is only 3 per cent. or thereabouts of the labour force of the country as a whole. That shows the excellence and adaptability of farm workers. But as the noble Lord, Lord Sainsbury, has said, this great effort has tended to collapse at the farm gates. One tends to say, "Here it is. Come and get it". No one who has been to the food shows in Paris and Berlin, as I have done, has come home without feeling that we have been losing out to our competitors in Europe. Therefore, better marketing is again the call of the day—but spoken of and listened to with more assurance now because much more money is available at the launching pad. For this too, agricultural Ministers deserve a good deal of credit.
There are three points I wish to make. The first is that the United Kingdom is famous as a producer of red meat. The noble Lord, Lord Tanlaw, has referred to Scotch beef. I have often thought when looking in shop windows that more beef is labelled "best Scotch" than the whole of Scotland produces; and the best of Welsh and English lamb is rightly famous too. But I hope your Lordships will forgive me if I make one further point, which is not totally irrelevant. It is that efficient marketing can hardly succeed without efficient slaughtering. This branch of the industry has been encountering tremendous difficulty. Hardly any well-known name—I have no interest now to declare—has failed to make headlines in the last year in a way that they would much rather not have done. The main cause, of course, is over-capacity. It is not, I think, a matter for the Government, but it is certainly one for ratepayers, with I believe every municipal slaughterhouse, I suspect without exception, running at enormous losses.
I am looking forward with the keenest interest to what I am quite sure is going to be a success story, because one thing I have learned in 50 years of farming is that nature does not allow farmers to grow crops that
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combine high quantity with super quality. My noble friend has mentioned Charter Bacon and the Great Brit. Potato Adventure; and I wish them both the best of luck. But I am bound to say that throughout my 50 years of farming it has paid me better to grow a large crop and sell it at a lower price than vice versa. I have been offered premiums for smaller crops of high quality—and once I was even invited to send wheat to Canada in order that it might be made into biscuits—but even that operation did not pay me as well as the higher crop that I sold at a lower price. I am bound to say that I think that Food from Britain, which is, of course to market food at home as well as abroad, has got to bear this in mind.
The last points I have are somewhat sundry. My noble friend has said that the Bill does not include the marketing of sea fish. Perhaps he will tell me if I am right in remembering that shellfish probably are included, being statutorily different from sea fish, having a recollection of a very successful stand run by the Highlands and Islands Development Board at one of the parish shows with Orkney crabs.
Secondly, is Food from Britain going to involve itself in the export of such things as Scotch whisky? If it is, I hope there will not be overlapping between the fairly efficient Scotch Whisky Association and the Food from Britain campaign. Thirdly, I am fascinated to know whether the Food from Britain campaign is going at the same time to push the sales of butter and dairy products, which it obviously is, and also urge people to buy margarine, because the area of oilseed rape is fairly high in this country and increasing, and if it is to advocate margarine I am just wondering how the chairman of the Milk Marketing Board, who I think is a member of the Food from Britain team, is going to react.
Finally, I wonder this. Does anybody really know what the consumer really wants? I ask this because a fortnight ago I listened on my radio to a member of the staff of the Meat Research Institute saying that on no account should meat have any fat at all, and anyone who thought that fat gave even a hint of a flavour to the meat needed his head seeing to, because it did not; whereas in the Daily Telegraph on the same day there was an account of a small agricultural enterprise in Devon which was breeding the rather old vintage types of pigs, the Middle Whites and the Wessex Saddlebacks, all of which I recollect gave an enormous amount of fat, and it was inundated with orders from people who were tired of the stuff they were getting in the butchers' shops now. With those words, I wish Food from Britain all the luck in the world.
7.25 p.m.
Lord Collison: My Lords, I, too, wish to congratulate the noble Lord, Lord Northbourne, on his maiden speech. I enjoyed it very much, and quite obviously he is going to prove a very great asset in this House; like others, I hope we shall hear him often. I would also, if I may, apologise to the noble Earl, Lord Ferrers, because I was a few minutes late in taking my seat when he opened the debate; I am awfully sorry. The amendments on the previous Bill went through much more quickly than I expected. I am sorry to have done that, with the great regard and respect I have for the noble Earl.

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This Bill has been widely welcomed. It was welcomed in the other place and has been welcomed here, and I join with those who welcome it and wish all good to the organisation which it is going to set up. I rise in order to call attention to the proposals which the Government have made and which affect the Land Settlement Association. If I throw a note of discord into this debate, it is not in relation to the Bill itself but in relation to what is being done to the LSA.
My interest in the Land Settlement Association has been a long one. I was a member of the executive committee for many years, first appointed 25 years ago. I became vice-chairman in 1964 and remained as vice-chairman until I became chairman in April 1977, a post I held until I retired in December 1979, when Sir John Colfox was appointed by the Minister, the right honourable Peter Walker. At that time the Minister was kind enough to write me what was a very nice letter which I greatly appreciated. He thanked me for my services over the years, and he said in that letter, if I may quote:
"You have seen many changes in the structure of the association and the smallholdings scheme since you were first appointed and can he justly proud of the high regard in which it is held today".
That was at the end of December 1979. I am not quoting those kind words of the Minister in order to draw credit upon myself. There were many others, of course, who had contributed before me and have contributed after me: there are many others to whom credit was and is due: the previous chairmen, successive members of the executive committee, and a very dedicated and loyal staff. I mention it only to stress the changed attitude of the Government since then, and it is a relatively short time ago. I am sure your Lordships will appreciate my regret at the developments that have taken place.
The Land Settlement Association was set up to help people without much capital to establish themselves in agriculture as smallholders producing for the domestic market. To make this possible the Land Settlement Association built up integrated marketing and production machinery. There were tenancy agreements with each tenant, who was specially vetted before he was allowed into the scheme and who had to have a certain amount of capital, but clearly not enough to start on his own. Tenants could obtain a grant from the LSA and get bank loans which were underwritten by the Government. The LSA acted as the Minister's agent in these matters.
In all my time, these arrangements seemed to be working well. I visited many of the estates, particularly during my time as chairman, and was told by many tenants that they had successfully built up their own businesses, and they expressed appreciation of the Land Settlement Association, which had given them a chance to get their feet on the first rung of the agricultural ladder.
I have not buried my head in the sand. That would be stupid, and I know, as we all do, that horticulture has run into difficulties. Indeed, problems were beginning to affect the industry at about the time I left the LSA. At that time some tenants and some estates began to demand more freedom to conduct their own affairs. They were beginning, but only just beginning,
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to express criticism of the way in which the scheme was operating. Now, since I have left, those criticisms have built up and, reacting to those criticisms, the Minister announced on 1st December 1982 that he was convinced that the tenants of the estates should take over responsibility for the marketing of their own produce and declared his intention of terminating the current LSA marketing arrangements from the beginning of April 1983, and also of terminating the agency agreement and enabling tenants to purchase their holdings if they so wished and if they were able to do so.
This decision, though welcomed by some, caused consternation among many growers. My honourable friend, Mr. Stanley Newens, in a speech in another place on 20th December—reported in Hansard at column 736—said he had received a large number of letters expressing considerable anxiety about the decision. Many tenants believed that they would be seriously damaged and even bankrupted. They pointed out the difficulties they would face as a result of the very short time they had been given to make alternative arrangements. Those difficulties were intensified by the withdrawal by the Minister of his guarantee to the banks.
I am glad, therefore, that on 19th January the Minister, in reply to a Question asked by Mr. Anthony Nelson in another place, said that he was prepared to arrange for the continuation of the association's centralised marketing services up to 31st December 1983. But the Minister added that all other aspects covered by his announcement of 1st December 1982 will remain unaffected. Of course, the Minister hopes that alternative marketing arrangements can be made in time, but the growers are still faced with considerable problems, despite what I think is the tardy recognition by the Government that they had a point that the Minister has partially met.
LSA tenants, like everyone else in the industry, have been adversely affected by the problems which face horticulture generally. Many have run into debt. The Minister's withdrawal of the guarantee to the bank will make it very difficult to obtain the loans they need to keep going. Apparently the growers will still receive an account from the LSA from the end of December 1982, which has to be confirmed to have queries rectified, and to be paid to the estate office by—it was—28th February. Although I am not sure about this, it may now be by 31st December. The point is that failure to do so will result in two months' notice to quit.
Thus, the growers' prospects of ever getting on their feet and getting their feet on the first rungs of the ladder will be nil. Despite the extension of time, as I understand it the Government are asking for all the assets of the existing scheme—grading equipment, lorries and tractors—to be disposed of by 31st December, which I assume is the new date, and the new organisation can take over only if it can be formed in time.
My concern is for the growers. It is for the tenants. It is clear that many problems still remain for them. The Minister says that he consulted the tenants. I wonder how far that consultation went. Were all the tenants involved consulted? I was very keen to create consultative machinery. As the noble Earl knows, I

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thought it right to do so. I worked for it and we obtained a joint consultative council. However, I do not know how far this consultation went. I certainly hope that it went the whole way and that all the tenants were involved. I certainly hope that the consultation will continue on the many problems which will arise and will affect the tenants as a result of the Minister's decision. As Mr. Newans said in another place:
"Even the attraction of buying … at 50 per cent. of its valuation is not very brilliant to those tenants who are unable to pay up what they owe forthwith, as the Minister has made it plain that, before buying, a grower must clear any outstanding debts to him." (Official Report, Commons, 20/12/82: col. 738.)
This remains true even if the extension of time to December 1983 applies.
I am not arguing for no change. I know that many growers wish for more autonomy and the freedom to market their own produce. However, it seems to me that, despite the extension, the Government have acted with undue haste and rather more than ruthlessly. They will cause embarrassment to many of the growers, who are worthy men, and also to the growers' families.
I ask myself: what is behind this precipitate action? What is the Government's motivation? It is apparently based on criticism by some growers. There are 500 of them on 10 estates, but in one fell swoop the Government have destroyed the whole of the structure which the LSA has administered in the past, I believe reasonably successfully, as the Government's agent. It looks very much as if the Government are thinking on the lines of what is called privatisation. I do not know, but it seems that way. It seems that criticism by some growers has been used as an excuse for the Government's action. Thus will disappear a scheme which was designed to assist those who could not otherwise have entered the industry. If adjustments were necessary, could these not have been made without bringing down the whole fabric of the scheme, instead of the Government getting out from under and abdicating what I see as their responsibilities?
The Government appear, I am afraid, to have made up their mind. If that is so, I sincerely hope that they will give careful and sympathetic consideration to the problems that will hit many tenants and their families. Again I say that they are worthy men and women. I hope that the Government will be flexible in dealing with them in order to give what help they can in the difficulties that will certainly arise in the future as a result of the Government's termination of the LSA scheme.
7.40 p.m.
Lord Stanley of Alderley: My Lords, I welcome the idea behind the Bill, for as a member of a number of agricultural co-operatives and, indeed, chairman of one for the past four years, I am more than conscious of the failure of farmers to bother to market their produce. So if I now air a few reservations, I hope that your Lordships will accept them as constructive, although I suspect that I shall, not for the first time or even for the last time, be chided by my noble friend and other Members of your Lordships' House for not joining in the general euphoria.
I am concerned that the council appreciates the inherent lack of interest—indeed, almost
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opposition—by farmers to organise their marketing, although I note that the Minister, Mr. Peter Walker, realised this in the third paragraph of his original press notice on 7th June. The failure to market our produce has been brought about in part by the system of support we have lived under for a number of years. Although it is, and has been, an exceptionally good system, it has not encouraged aggressive marketing, and in this connection I would entirely agree with the noble Lord, Lord Sainsbury. It is probably true to say that if a similar sum of money to that suggested in the Bill were given to farmers to improve their returns, it would be better spent lobbying the CAP in Brussels. I hope that my noble friend and the council will recognise that, and also the fact that many farmers—and I certainly include myself as one of the sinners—prefer to devote their energies to production rather than to marketing. Some accept this failing and join a co-operative. That brings me to my second worry, which is our co-operative movement which will come under the council when this Bill is enacted.
As the noble Lord, Lord Northbourne, so ably pointed out—and I should like to congratulate him on a superb maiden speech—the co-operative movement in the United Kingdom is totally different from that which operates on the continent. Our successful cooperatives, as the noble Lord said, are inclined to be small because we still believe in the "small is beautiful" philosophy; whereas our continental sisters are large and impersonal.
I personally would not wish to see our co-operatives grow into big brother organisations, but I think—although I may be putting words into his mouth—the Minister, Mr. Peter Walker, suggested in his statement to the press on 7th June that they should or might go that way. The snag with our small co-operatives is that they are inclined to be unprofessional, and when asked to shoulder extra burdens—and I envisage that this Bill may well put those extra burdens on them—their organisation is not up to it. Perhaps their two biggest difficulties seem to be the loss of personal contact with a member and getting the correct relationship between the farmer director and executive. There is a question of commitment and bite, as was mentioned earlier.
I hope that the council will appreciate this very real problem. One way in which they could help is to stop appealing to the loyalty of the co-operative—and I should like to point out to my noble friend that it is not a regiment that we are talking about, and you do not have the same loyalty to your co-operative as you do to a regiment—and try instead to make sure that returns received from co-operatives are better, because that is what will keep the co-operatives working successfully. That was brought out so ably by my noble friend Lord Stodart of Leaston, and, indeed, the noble Lord, Lord Tanlaw. However, I wonder how they will do that, because the Bill does not give the council power to control production. Indeed, I do not think that it should do so. But if such is envisaged, then your Lordships should think hard and long in particular about the method of appointment to the council. Here I seem to be at slight loggerheads with some. I am obviously concerned, sitting on these Benches, that should another Minister ever be in charge of appointments—although of course I cannot see that

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ever happening—a total turnover in the members should not occur. But, perhaps more seriously, I would ask my noble friend who the Minister will consult before appointing members to this council.
Finally, I am concerned as to what the council can do to help market British food; how they can do it; and when they can do it. The idea is perfect, but would any commercial undertaking put 15 totally strange people together and tell them to get on with it? The members of the council have an awesome problem, not least a personality one, of getting on and getting to know each other on the council. I really do wish them well, but I would not be surprised if they failed. I know that my noble friend will accuse me, and probably correctly, of being a Jeremiah. Therefore I repeat: the idea is right; the job badly needs doing, but perhaps those of your Lordships who saw Shakespeare's Richard III last night would appreciate that many of his objects were correct, although perhaps some of his methods were somewhat suspect. I hope that my remarks, if nothing else, will give the council an insight into the suspicious nature of a backwoodsman farmer with whom they will have to work and whom they will have to educate.
7.47 p.m.
Lord Mountevans: My Lords, I, too, join other noble Lords in congratulating the noble Lord, Lord Northbourne, on his lucid and stimulating maiden speech. In several respects he has pre-empted me, but I think that perhaps in several respects I was a party to my own downfall because I had the pleasure of helping him in the Printed Paper Office the other night. It is a pleasure to welcome the noble Lord to our House and I hope that we shall hear from him often.
I feel that I should declare an interest, albeit a distant one. I have worked for the British Tourist Authority for over 10 years, at home and abroad. Throughout that time I have been selling Britain to foreigners as a tourist destination—an activity which it seems to me parallels the overseas rôle envisaged for Food from Britain. My approach to the Bill before us tonight has been influenced by my experiences over the last decade. All but one of the BTA facts that I shall quote is published information, but any opinions that I may give, although discussed with senior colleagues within the authority, are my own.
I strongly welcome the Bill because I believe that any attempt to market British goods or services abroad is, in present circumstances, an effort greatly to be desired. while a body' which sets out to develop and co-ordinate such marketing is even better. Marketing abroad is a skilled and costly task, better fulfilled, I feel, by concerted effort than in dribs and drabs. Marketing abroad literally involves keeping our goods and services in the overseas shop window. A great deal of effort is needed not only in that generality but in attention to detail, to ensure that the customer is aware that our goods are of the right quality, arc available in the right place at the right time and are available at a price which he or she feels constitutes good value for money. Reading the Bill and the list of members designate of Food From Britain's council and looking at the experience that they have between them, I feel confident that the requirements I have listed and the criteria will be met.
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I am a little less confident about the funding envisaged for Food from Britain—although I hope that the noble Earl the Minister will reassure me. It is, I understand, the intention that all marketing activity will be funded 100 per cent. by the industries concerned by the five years ending 1987–88. My reservations stem from the fact that for more than six years I have been running the budget of the British Tourist Authority's Joint Marketing Schemes. Quoting from the British Tourist Authority's last annual report, it says that this:
"budget attracts external funding for BTA activity and reflects Government's continued emphasis on 'self help'. The budget is allocated to co-operative ventures which are in line with BTA's marketing plan and objectives."
These plans and objectives we have to sell to our promotional partners before we can go out and sell abroad. The funds for co-operative activity must be got in before they can be got out. Once we have them. our spending plans are still subject to exchange rate fluctuations; I am sure that several noble Lords will have seen The Standard tonight, reporting that sterling took another hammering against the dollar.
A fact which will I think affect Food from Britain, as it does us, is the harsh reality that at times when the sterling exchange value falls and makes the goods that we or Food from Britain are selling more attractive in overseas terms, it also makes the very overseas promotion of the goods or services we are selling more expensive. Food from Britain will doubtless have both strategic and long-term plans as well as practical plans. The time scales for planning these two facets will, I am sure, differ, and I am worried that Food from Britain's plans might go awry if it cannot sell its plans to its co-operators. Are the period of Government support through 1987–88 and the sum envisaged of £14 million by way of that support both inviolate facts, or will both be subject to review as time progresses? I ask the question against the backgound of experience that I have cited, but I also have in mind that Food from Britain's potential co-operators may disagree with that body about allocation of marketing resources to home and foreign markets.
Turning to matters of less substance, I would appreciate clarification of Schedule 1, paragraph 6, as to whether the words:
"… Food from Britain may appoint committees consisting of or including persons other than members of Food from Britain".
permit those council members to serve on such committees. I hope that the members may so serve, as, looking again at the BTA's annual report, as well as those of a number of other statutory bodies, I notice that committees are frequently chaired by members of the parent board or council. It seems to me that this practice is sensible in that, as such, council members constitute an important channel for conveying and explaining policy one way as well as receiving experience in the other direction.
I notice that Food from Britain may charge for the services that it provides. I should like to ask the noble Earl the Minister whether services include advice, as I am a little concerned that the small businessman, the small operator, the small producer—call him what we will—who may well have a greater need of guidance than larger entities, will be put off from seeking such guidance by virtue of the fact that he may have to pay.

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for it. Even if the advice given is only, "Go out and join a co-operative", I hope that it will be freely given and will be given free.
I should like to raise one other small point; it concerns the use of the word "behoof" in the last line on page 7 of Schedule 1. Recently I attended what was in some respects the most interesting debate that I have had the pleasure, indeed the advantage, of hearing in your Lordships' House. It concerned the volume and the complexity of statute law and it makes me ask whether a word such as "behoof" still has a role to play in modern legislation.
I have spoken of my enthusiasm for this Bill and for the concept that it embodies. I see Food from Britain as a cousin in the family of statutory bodies. In fact, I am not the first person to see this; BTA and Food from Britain were bracketed together during the Standing Committee stage in another place. With the ready assistance of the Minister, we have already been introduced and I greatly look forward to meeting Food from Britain's chairman-designate within the next few days. I am sure that we shall find much to talk about, and I hope that we shall find scope for fruitful co-operation. I wish him, the council, Food from Britain and the Bill godspeed.
7.54 p.m.
Lord Wise: My Lords, I understand that it is the general practice for only the first three following speakers to congratulate a maiden speaker, but notwithstanding that fact I would very much like to congratulate the noble Lord, Lord Northbourne, on his fine maiden speech. I think that his wide knowledge and business expertise will surely be a great asset to this House, and I most certainly look forward to hearing him on many occasions in the future, and not only on agricultural affairs.
My noble friend Lord Stanley referred to himself as a backwoodsman farmer. Whether or not that is so, I do not think I would call him that, but I most certainly am. It is for this reason that I wish very briefly to speak and express my general support for this Bill. In his opening remarks my noble friend the Minister spoke of the achievements of the agriculture Ministry, and it is recognised that the efficiency and record of agricultural production is second to none. This production is obviously of inestimable value to our balance of payments position.
However, I think we farmers must now appreciate that our job no longer finishes at the farm gate. We must get out and take a greater interest in the selling of our products. Surely we cannot expect the consumer to buy British produce irrespective of its quality and its price. This means that we must use less of our managerial skills in increasing production efficiency, and devote more to increasing our marketing efficiency. We must take more notice of our grading and presentation and only present goods of the highest quality and conformity. I think that this is one aspect in which we have tended to fall down in the past.
I have a friend who grows a very large acreage of vegetables of all kinds in Norfolk; he probably grows as many as anyone else in the county. I know that he discards quite a considerable percentage of his produce as not being up to standard. However, he has a good
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and steady market for all the produce that he presents to his buyers; his grading is such that there is complete uniformity and, as he says, "First-class produce will always sell". I am certain that he would agree with the noble Lord, Lord Northbourne, that this is not always possible to achieve with co-operative systems. As the noble Lord, Lord Tanlaw, has said, the grading of all produce—not only of meat—is of paramount importance, but there must—and I think that Food from Britain should take great notice of this—be incentive for quality.
I am convinced that some degree of co-operation is essential in any marketing strategy, but I was glad to hear my noble friend Lord Ferrers say that the independent sections will not lose out under this Bill, and Food from Britain will be able to co-operate and will not be in competition with the small organisations which have already established their market outlets without any Government aid. I hope that that is so; I think I understood my noble friend to say so.
In the highly competitive food market both for export and at home it is essential that there is a well organised outlet for all commodities, especially those such as vegetable and horticultural products, and poultry and pigmeat, for which there is no intervention buying. For this reason I welcome the Bill and hope it will go far towards achieving this and thereby ensure a fair return for the primary producer and all the processors, retailers and wholesalers, plus value for money from the consumer.
7.59 p.m.
Lord Beswick: My Lords, this Bill has been given an unusually generous welcome from all political parties and it is a welcome which I support. The character of this piece of legislation, if I may say so, speaks well for the attitude and the aptitude of agriculture Ministers including the noble Earl, Lord Ferrers. I allow myself to add that if only the Treasury and Treasury Ministers were characterised by the same constructive and expansionist attitudes then our economy might be in much better shape.
My immediate interest in this Bill springs from my special interest in the co-operative movement in Britain. The Bill in its working, if not in its present wording, has much to do with co-operation as noble Lords have recognised, both in the production and in the marketing of agricultural produce. Some would say that it is a shortcoming of the Bill that there is no specific reference in the wording to the potential advantages of developing agricultural co-operatives.
I noticed that in the other place the Secretary of State listed those organisations that might have been expected to have had representation on Food from Britain. He named all the farmers' associations, the country landowners, even the Consumers' Association, but not, strangely, the British Co-operative Movement. Yet it is far and away the biggest organisation of consumers in this country. It is the largest farming organisation in the country and, with due respect to my very dear friend, the noble Lord, Lord Sainsbury, it is still the biggest retailing organisation.
I take this opportunity of congratulating the noble Lord, Lord Northbourne, on his maiden speech, which I found especially interesting in his references to

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co-operation. He was very realistic, as were those practical farmers from the bush now sitting on the Back Benches, the noble Lord, Lord Stanley, and the noble Lord, Lord Wise. What they were saying was that if we are to have co-operative organisations they have to be good. That is right. I would agree with that. I would say that that goes for cricket teams as well.
I was glad to hear the noble Earl, Lord Ferrers, say that the co-operative concept will have a contribution to make, but I would press him to expand this a little further for two reasons. The first relates to the Central Council for Agricultural and Horticultural Co-operation. My noble friend Lord John-Mackie, and indeed the noble Lord, Lord Sainsbury, and the noble Lord, Lord Stanley, paid tribute to the work of the central council, but it is now to be brought within the Food from Britain organisation. The apparent idea is that the CCAHC will retain its old responsibilities within the new structure. I am not completely convinced about the reasoning here. I am not sure that it is strengthening the central council's position. I am myself a great believer in decentralisation. I believe that if responsibilities are to be an incentive and a motivation, they must be seen, and seen clearly, from outside.
Of course, much will depend on the actual organisational structure of Food from Britain. It might be said that this is not a Second Reading matter, but the Minister has touched upon it in two respects. We are told that the vice-chairman of the parent organisation will be the chairman of the central council or its successor. If the chairman was the vice-chairman of Food from Britain by virtue of his being the chairman of the central council, that would emphasise the importance of the central council's future role. But, of course, it could work the other way. It could mean a blurring of the responsibility, and I should be most grateful if the noble Earl would spell out a little more about the concept as he sees it of the importance in the Food from Britain organisation of the central council's work.
The other relevant point that has arisen concerns the funding of the central council. It is stated that there will be Government funding for Food from Britain but phased out over five-years. On the other hand, I believe, though I should like confirmation, that Government funding for the central council will be continued after the five-year period. If there is this differentiation that would seem in itself to be an argument for having the central council still outside on a separate basis.
Over many years I have known some very interesting cases where Government funding, intended for a specific department or a specific project of a large organisation, found its way to support other activities within the same organisation—worthy activities, of course, but different. Accountants are very ingenious individuals in this respect. I should be grateful if the Minister could say a little more about the intended and continued role of the central council.
There is one other matter on which I should like to comment and on which, again, I seek assurances, that relates to the Land Settlement Association, about which my noble friend Lord Collison has spoken. If I may say so, there is no one better qualified than he to
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speak about the Land Settlement Association. As he indicated, on 11th August last year the Secretary of State applauded in a press notice, from which I quote,
"the considerable progress made in planning for the long term future of the Land Settlement Association".
Then on 1st December of the same year the same Secretary of State stated that the marketing arrangements of the LSA would be terminated as from the beginning of April 1983. In other words, the long-term future, about which encouraging words were spoken in August, turned out to be less than seven months. By any criterion that is a strange turn around. In another context it would be called a U-turn. Can the noble Earl say what happened in the autumn of 1982 to justify such a change of attitude?
After representations and, as Lord Collison said, especially representations made by my Co-operative Party friends in another place, the Government again changed their mind and agreed to extend the time for termination until December this year. This concession is welcomed, but the noble Earl may understand that some suspicions still remain. Has there been a change of heart as well as a change of date because the heart did not seem to be in the right place last August. Many of these LSA tenants, good, hard-working men as they are, have been doing business with the sort of financial problems that are not unknown in Britain in 1983. The closure in March would have meant permanent closure for some of them.
I have heard it said that maybe the possibility of closure was one reason for this date being so extraordinarily inappropriate. One reason for this suspicion, which I hope the noble Earl will be able to dissipate, appears to exist because tomato growing—and these growers are especially concerned with tomato growing—has marketing problems, surplus problems. These people manage to produce something like 8,000 to 10,000 tonnes of tomatoes a year. The surplus problem is emphasised by an answer the other day given in the other place that 85 per cent. of the large EEC intervention stock of tomatoes was last year rendered unfit for human consumption. I hope that the Minister will be ready to say that there was no question of restricting production and making it difficult for all these LSA growers to remain in business. I am not here myself trying to suggest that we should go back to the old LSA set-up. Of course, it was open to criticism. Its original concept was not entirely realised, and improvements no doubt were possible.
I put three specific questions to the noble Earl. Will he make it absolutely clear—and I think it will be in his interests and remove a lot of suspicion if he will—that the original sudden death announcement about the LSA marketing scheme was not intended to eliminate some sections of the LSA estates? Secondly, will the Minister give assurance that all practical assistance will be given to the growers in this transitional period, both by way of advice—probably from the central council—in the establishing of co-operative marketing arrangements and also in suitable financial assistance? Thirdly, will the Government, under the Agency Agreement they have with the LSA, make sure that the position of the LSA staff, some of whom have served loyally for many years, will be safeguarded?
I am told that many of the LSA tenants are only too ready to strike out on their own. Far be it from me to

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discourage individual initiative, and I can well understand the temptation to buy land today at cut prices. That can indeed attract buyers. Some of those buyers may well make their own satisfactory local marketing arrangements, but there is a good deal of evidence to suggest that co-operation pays, in every sense of the word, in the marketing of agricultural and horticultural produce. When the first fine flush of being a land owner wears off there will be some of those former tenants who rise to the Government bait who will be glad that others had the good sense and tenacity to ensure the establishment of a co-operative marketing system when the present arrangements end.
Finally, I would ask the Minister if he would tell me a little more about this cut-price sale of the LSA land. It was stated in the Commons, and not contradicted, that the price at which the land will be offered will be 50 per cent. of cost. This surely cannot be true. Not 50 per cent. of original cost, I imagine. Probably the noble Earl can tell us what the facts are. The vacant possession price of grade one land in England last year was on average £2,689 an acre. Will the noble Earl be good enough to say at what sort of price this public asset of LSA land will be offered to the private purchasers? I have asked a number of questions. There are quite a number of people outside who will be interested in the answers, and I look forward to hearing what the noble Earl has to say.
8.13 p.m.
Lord Saint Oswald: My Lords, I rise in this debate partly because I wish to be among those to congratulate the noble Lord, Lord Northbourne, on his maiden speech, and to agree with the confident prediction made by the noble Lord, Lord Sainsbury, that we can look forward to many valuable contributions from him in future debates. Unlike some others I have had the advantage of knowing him for a number of years, giving me some awareness of the enterprise and energy with which he produces and markets grain and vegetable crops, seeking fresh territories to develop and make fruitful. He is therefore speaking to us with real knowledge, as most speakers in this House do.
He even sought my advice on one occasion with an impressive scheme in mind to plant a specific crop in a part of Spain with which I was familiar, but in this instance his creative intention was inhibited or curbed for the time being. It occurred to me that adventurous Englishmen in the first Elizabethan era went to Spain to pillage; he was going to plant and improve the territory of Southern Spain, with lettuces on a vast scale, as it happens.
Like him, though on a far smaller and less original scale, I have to declare an interest in this debate and in this Bill. Farming, as I do, in Yorkshire and Lincolnshire, lately but increasingly I have been exporting to new and previously hardly considered markets. I have sold rose bushes to Zambia and Zimbabwe, to West Germany, and, more surprisingly, to the Netherlands, who in the past have been so successful in penetrating British markets. I have sold cows to Iran, and so modestly assisted the balance of payments in that direction.
None of this is altogether easy, and apart from imagination and alertness it often requires the overcoming of artificial handicaps. In the agricultural
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and horticultural fields my managers have described to me frustrations imposed upon our production. It is recognised that Britain does not obtain an equitable share of the home market in dairy products. The milk flows prodigiously from British udders, but cheese and butter and other dairy products from overseas appear in profusion on the shelves of the supermarkets of our land. Is this a weakness in marketing methods? We are undoubtedly efficient pig producers, but bacon and ham from other sources flow in for consumption at British tables. It may be, as my noble friend the Minister has implied, that marketing is the key, and he mentioned some telling examples.
There are other examples somewhat less telling and less hopeful. I am assured, without being directly involved, that Britain produces cheaper quality lambs than any other member of the European Community, and yet our share of the Community market is relatively small. Is this also a failure of marketing methods and skills, and would it to some extent be redressed by the provisions of this Bill? My noble friend beside me said in his speech that we do not meet our own production needs in lamb. If that is so the question may well lie less in marketing than in productivity. That is one of the things that could be looked at.
The emphasis throughout this Bill is consistently on food, and therefore I felt that I ought to discover for myself whether flowers and flowering plants were actually included, as I find they are. Rose growing is a field in which I am directly and almost emotionally involved. As a long-serving and identifiable European, I can commit myself to probe where it seems that inequities between our partners and ourselves exist. Is it the case that for horticultural products the Dutch Government provide a highly preferential gas tariff for growers which gives them the edge over our own growers paying steep oil-fired heating costs with no preferential treatment of special allowances from the Government? I am specifically not arguing that under-the-counter advantages should be given to us. I am arguing, as a good European, for tighter regulations and fair trading, so that quality growing and good marketing cannot be offset by the methods of others.
We import, as is right, from our partners in the Community, but have in the course of trade discovered a problem of quite a different nature from that which I mentioned earlier. It is believed by those engaged at first hand in horticultural trade between the Continent and the British Isles that the looser discipline on road vehicle tonnage of wagons gives the Continental growers, or some Continental growers, an advantage over our own. As an example which has come directly to my experience, a single Dutch wagon can carry more tonnage on Dutch soil than an English wagon is permitted to carry on English soil. A built-in disadvantage becomes apparent; a disadvantage which can be critical in highly competitive trade.
Finally, I have one specific question which should not, I think, need asking but upon which still unsatisfied ignorance exists and of which I have given prior notice to the Minister who will wind up this debate. Should VAT be paid on consignments of agricultural and horticultural produce going overseas; should it be paid at this end or not? That question has been put to Ministry officials in Yorkshire, who have

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admitted that they do not know the answer. There must be a specific answer, and I hope to receive it, for the benefit of many in doubt, from the lips of my noble friend Lord Ferrers when he replies to the debate.
I, among almost all others who have spoken, can give my uncritical blessing, for what it is worth, to the Bill, and to its future. I am probably echoing a passage in the speech of the noble Lord, Lord Northbourne, when I say that, so long as the purpose of Clause 2 comes to signify what it says, the original purpose of bringing the Ministries of Agriculture, Fisheries and Food under one roof and under one direction will have been carried an important step nearer to reality.
8.21 p.m.
Earl Ferrers: My Lords, I am grateful for the welcome your Lordships have given to the Bill. Almost without exception, noble Lords have welcomed its provisions, and I am grateful to them for that because the introduction of Food from Britain is a milestone in the life and production of marketing in this country.
I wish at the outset to add my sincere congratulations to the noble Lord, Lord Northbourne, for what I thought was a model maiden speech; it was short, uncontroversial, knowledgeable and fun to listen to. It came, of course, from his substantial knowledge as a farmer who is well versed in co-operatives. I have always thought that the law of a co-operative should be that everyone should be prepared to put in more than he gets out; and if all are prepared to put in more than each gets out, each gets out more than he puts in.
The noble Lord rightly commented that 100 years ago all food was prepared either in our farms or our kitchens, whereas now the bulk of it is manufactured or processed before it is eaten. That is the nature of the game we are in; that is the monumental change which has taken place and that, in a nutshell, is one of the reasons for Food from Britain. The tremendous move to processing inevitably involves marketing, and it is our desire to see that marketing is as efficient as possible. The noble Lord referred to the definition of "marketing". I can confirm that, although it is not actually defined in the Bill, it is interpreted as widely as possible.
I was grateful to the noble Lord, Lord John-Mackie, for his welcome of the Bill, particularly as it came not only from the Opposition but from a former holder of the office I have the honour of holding at present in the Ministry of Agriculture. He made a passing reference to the fact that the Bill had taken a long time to come forward, and that whereas it is now 1983, it was being talked about in 1979. I would only advise him of the remark made by my right honourable friend when asked that very question. He said, "We have not had Food from Britain for the last 2,000 years. If we take a few more months to get it right, I do not think the country will be much the worse off".
I was glad that he and the noble Lord, Lord Sainsbury, agreed it was good that there should be no statutory members of the council, and the noble Lord, Lord John-Mackie, was glad it was not a question of Buggins' turn. He is absolutely right. The point is to choose lively minds; they make things work and, on
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the whole, Buggins' turn is not a recipe for scintillating activity. That is why this recipe has been produced in the Bill. My noble friend Lord Stanley asked who was consulted over it. I would remind him that the Bill gives the agriculture Ministers power to appoint the people, and they should have interests in connection with agriculture; I do not have the precise wording in front of me. The matter is considered with people, but there are no specific strictures to take official soundings or recommendations.
The noble Lord, Lord John-Mackie, asked a question which his noble friend Lord Blease would have asked about Northern Ireland: whether Ulster produce would be able to continue to be marketed under that name. Yes, it will be. Food from Britain will help to develop the marketing of food from the regions, and there will be no loss of regional identity. In saying that, I am glad that the wish of the noble Lord, Lord John-Mackie, of 50 years ago has become a fact and is no longer just a dream. I am glad that it is the party to which I happen to have the good fortune to belong which has been able to introduce it, while appreciating the fact that the noble Lord did not have the good fortune.
The noble Lord, Lord Tanlaw, said promotion must not be at the expense of quality and consistency. He is absolutely right. The powers given to Food from Britain in Clause 2 to improve marketing are very wide. It will be up to the Council of Food from Britain to determine its own strategy within that framework, and I am sure it will place particular emphasis on improving the marketing of quality products which are geared to the demands of consumers. Food from Britain will not be in the business of endorsing Britishness just for its own sake. It will aim to ensure that the best of British food—including Scottish, Welsh and Ulster food—is available both here and abroad.
The noble Lord gave a bleat (if that is the right word) for Scottish beef producers—that they should get better prices—and he said he wished to draw that to my attention. I respectfully suggest that there is not much point in doing that. He gave a classic example of how, with an excellent product which in his view should commend better promotion, better success and a better price, promotion should be available to achieve that, and I have no doubt that Food from Britain will take that on board. But of course it is up to those who produce, if they feel they are not marketing their goods properly, so to organise themselves. And from what Lord Tanlaw said, he seemed to indicate there was scope for improvement there.
The noble Lord, Lord Sainsbury, spoke about marketing. If the record of one who is so distinguished and who has such a distinguished household name does not show him to know how to provide what the consumer wants, I do not know what does. He said we were the best producers in the world but that we had slipped over marketing. I agree entirely, as does my right honourable friend, as he knows only too well. It has been my right honourable friend's intention and desire to see improved the marketing not just of British agricultural produce but of British food and the noble Lord is right to say that marketing involves discipline.
My noble friend Lord Stodart wished success to the Bill and I was grateful to him for that. Like the noble

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Lord, Lord Tanlaw, he also said that the United Kingdom produces the best beef in the world, and there is no doubt that there are opportunities for promoting that in a better way than has been done in the past. He quite rightly referred to the slaughterhouse difficulties. As he said, good beef cannot be produced if there are not available good slaughterhouses. My noble friend is quite right; there is overcapacity. Slaughterhouses in this country have been going through a very difficult time. He is also quite right to say that no Government can be disinterested, though in fact the matter is not a responsibility of Government.
My noble friend asked whether Food from Britain will he involved in the marketing of Scotch whisky, butter, or margarine. Food from Britain may be concerned with the marketing of any food and drink, whether it be whisky, butter or margarine, and there is a place for all products on the market. Food from Britain will work closely in co-operation with all the existing organisations, to add to their efforts and so strengthen our achievements both at home and abroad. My noble friend asked whether shellfish are included under the Food from Britain organisaton. Shellfish are included in Food from Britain's activities.
The noble Lord, Lord Collison, apologised for missing my opening remarks, due to the fact that in the preceding business amendments went rather quickly. I can sympathise with that view; I nearly missed my own opening remarks, if I may so put it. The noble Lord expressed concern about the Land Settlement Association. Indeed, the noble Lord's deep inside knowledge, which has been gained from 25 years' experience on the association's executive committee, has made him uniquely qualified to speak on the Land Settlement Association. I am very grateful to him for the remarks that he made on that matter, on which the noble Lord, Lord Beswick, also made various comments.
I should like for a minute to consider the Land Settlement Association. I can understand the sorrow of the noble Lord, Lord Collison, at seeing disbanded something in which he was deeply involved. He is quite right; the growers are worthy people. They are what one describes as the salt of the earth, prepared to work with their families for all hours, frequently for very modest returns. They do it because they want to be independent and because they are determined to make a success of it.
It is a sad fact that horticulture has had a difficult time over the last few years. The Land Settlement Association has had a very difficult time. There are people in the association who have difficulties, and whatever might have been the course of the association's activities they would still have had difficulties. Our business as a Government has been to try to extricate as many growers as possible from the difficult position in which they find themselves. The noble Lord, Lord Collison, asked what consultations there had been. I can tell him that 18 months ago I attended a growers' conference in Cambridge. Many growers, and many Members of Parliament representing them, have come to see me and to tell me of their plight.
The noble Lord, Lord Collison, asked, why had the Government been so precipitate? The cry from the growers has been—I am now generalising—that the
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Government must act, and must act quickly, because otherwise individuals will be in difficulties. That is what we have tried to do. We wanted to give growers the opportunity to take over the responsibility for the marketing of their own produce. It is clearly far more appropriate for growers themselves to do this, rather than for the Government to do it. It is also something for which a large number of LSA growers have asked, and indeed it was very much in line with one of the recommendations of the Wise Committee, which was made as long ago as 1967.
So often there came the complaint that the Government were involved and that the Government were telling growers what to do, whereas they wanted to organise themselves; and that is what we have tried to enable them to do. We feel that it is right to offer the tenants the opportunity to buy their holdings at tenanted value. The noble Lord, Lord Beswick, asked, at what kind of value were they to be offered? The holdings are to be offered at tenanted value, which depends upon the value of the land and the assessment that a valuer makes of that. This in fact represents an attractive deal for those who wish to buy. Those who chose to remain as tenants will, of course, have security of tenure for their lifetime.
The response to our announcement has been encouraging. The main worries of the tenants concern the timetable for the close-down of the LSA's marketing services, and the announcement that my right honourable friend made last week has, I think, gone a long way to removing those worries—
Lord Beswick: My Lords, will the noble Earl allow me to intervene for a moment? Did I understand him to say that the holdings are being offered at the full value? If that is so, where did the 50 per cent. idea originate?
Earl Ferrers: My Lords, the holdings are being offered at tenanted value, and I am sure that the noble Lord, Lord Beswick, will know the difference between tenanted value and freehold value. I do not mean that in any disparaging way. Very often the tenanted value is in the region of, maybe, 60 per cent. of the freehold value. That is a fact of life. I am not saying that that is the figure that will be given in each individual case. But one of the facts is that tenanted value is about 60 per cent. of the freehold value. Whatever figure is assessed, the occupant will be able to purchase the holding at tenanted value. If he so wished, he would then be in possession of something that he could sell thereafter at freehold value. That is why it is quite an attractive proposition for the tenant.
The noble Lord earlier asked what is being done about Government accountability—I think that those were almost his words; that the Government were selling off land at lower than market value. In fact it is not lower than market value, because the market value is the value of the land with the tenant on it. It receives a greater value only when it becomes freehold. By doing this, we shall be giving the tenants who, in many cases, have spent a lifetime on their holdings, the opportunity to purchase them, the opportunity to own their own homes. We shall be giving them the opportunity to run their own businesses, to run their own co-operatives, as opposed to being dictated to by

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Government; and we shall be extricating the Government from a business which in fact they should not be in.
The noble Lord, Lord Collison, said that it started in the 1930s. He is quite right. The LSA started under very difficult circumstances. It tried to encourage people who were out of work to take on a new job and a new life. That was appropriate in the 1930s. But people have gone in and have found that they did not achieve quite the results that they had expected—
Lord Collison: My Lords, in all my time with the LSA I never gained the impression that the tenants thought that they were being dictated to by Government. They saw the Land Settlement Association, which was of course the Government's agent, as an entity in its own right, and therefore they did not say that the Government were interfering, though sometimes they criticised the LSA for doing certain things, or for requiring certain things that they did not like.
Earl Ferrers: My Lords, I think that the dictation to by Government—if that is the phrase that I used; and it was probably not the best of phrases—was due to the fact that growers were obliged to market all their products through the LSA. If in their view the LSA did not market them as well as it should have done, the growers were struck with no other outlet.
Lord Beswick: My Lords, I apologise for interrupting, but if one follows the argument, one finds that the old arrangement was not so completely satisfactory. What advice, what financial arrangements, are to be forthcoming for the transitional period?
Earl Ferrers: My Lords, there have been a number of statements by my right honourable friend explaining what is to be done. I think that it would be difficult for me to go into them in detail now. But I would say that we originally set a deadline for April of this year. There were complaints that that was not long enough for LSA tenants to make their own arrangements for their own co-operatives. We have extended the deadline to December 1983 for those who wish to continue to market through the LSA. For those who make their own co-operative arrangements meanwhile, that is in order. There have also been extensions for facilities with regard to their financing.
The noble Lord, Lord Beswick, asked whether there was any link between the resolution of the problems of the LSA and the tomato marketing report. I can tell him that there was absolutely no link whatsoever. There was no intention of deliberately removing the LSA in order—as I think the noble Lord said—to eliminate some section of tomato growers from the market. He asked what advice was to be given to the LSA estates in the meanwhile. The advice will be available (and is already available) to the estates from the LSA and from the Central Council of Agricultural and Horticultural Co-operation. The usual grant-aided assistance for the estate co-operatives will be available.
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The noble Lord asked about redundancy terms for LSA staff. These are being agreed with the LSA staff through the usual procedures, and I hope that many in any event will be soon re-employed in the successor co-operatives. LSA employees will also be able to buy their houses.
My noble friend Lord Stanley asked whether Food from Britain will encourage larger co-operatives. Food from Britain will continue the work of the Central Council and will encourage the development of co-operatives of whatever size the members may wish. It will not impose upon them any blueprint for their organisations.
The noble Lord, Lord Mountevans, referred to the £14 million available over five years. Clause 7(1) enables the Ministers to make grants to Food from Britain. We have indicated what the Government's intention is; and it is to give £14 million over a five-year period. Food from Britain can co-opt outside people for work on the boards of the organisations. Will there be a charge for services?—Of course, the only services for which there would be a charge would be such things as publications or substantial market research or the setting up of promotional activities, but not for advice to the small man who goes along to ask a question. The noble Lord asks whether it was necessary to use the word "behoof". I am bound to say, that I, too, think it is a quite extraordinary word; but the Scots have very extraordinary language and apparently it is essential in Scottish law. Considering that we are dealing with cloven-footed animals as well, I do not know that it is totally inappropriate to have this word "behoof" in the Bill.
The noble Lord, Lord Wise, asked whether, if small, independent traders are doing good marketing jobs, Food from Britain will interfere. Food from Britain will not interfere if all parties are content; and the small producer will continue as now.
My Lords, there are a number of other questions which some noble Lords have asked but to which I fear time prevents me from answering. I would merely say, if I may, that we have seen a continuing and significant improvement in the productivity and efficiency of our agricultural sector. We are now 75 per cent. self-sufficient in the types of food that we can grow in this country and that, itself, is a remarkable achievement. To a great extent, these achievements have been in isolation from each other. Each sector has tended to view others as rivals without discerning the degree of common interest among them. The potential benefits to the nation as a whole from joint ventures to achieve the same goal ought to be able to bring about quite considerable improvements. We want to see British food on the tables of the world. I hope that this Bill will encourage that to happen.
On Question, Bill read a second time, and committed to a Committee of the Whole House.

ECC 1st Report: Trade Marks
8.45 p.m.
Lord Scarmanrose to move, That this House takes note of the report of the European Communities Committee on Trade Marks (1st Report, 1982–83, H.L. 21).

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The noble and learned Lord said: My Lords, I beg to move that the House takes note of the report of the Select Committee on the European Communities upon certain proposals made by the European Commission for establishing in the Common Market a Community trade mark. These proposals of the Commission were published in November 1980. Similar proposals earlier had been under consideration for a considerable number of years. The proposals are to establish a Community trade mark and to do so by means of two instruments, a regulation and a directive. The documents published in November 1980 were a draft regulation and a draft directive.
The regulation would establish a new Community body, a Community trade mark office; and the task of that office would be to grant Community trade marks, to maintain a register of Community trade marks and, subject to an appellate procedure, to deal with oppositions to grant of a Community trade mark and with applications for removal of such marks from the register, and for declarations of invalidity. The marks to be registered would be marks for goods and also for services.
It is important to bear in mind that if the draft regulations were to be implemented there would be a Community trade mark system covering marks applied to goods and marks applied to services. The Community trade mark would be valid in every member state. In order to get it, it will be necessary to make only one application. One registration would secure the comprehensive cover for trade marks now available in the Common Market only by eight registrations in eight different national systems. One must make eight applications at the moment and get eight registrations in order to secure the only trade mark protection available at this moment in the Common Market.
The Community trade marks system being proposed by the Commission would replace all that by one application and one registration; and the mark so registered would be valid, recognised and enforceable throughout the length and breadth of the Common Market. It is important to bear in mind when considering this proposal that the Community trade mark would not be in substitution for those eight national systems now prevelant in the member states; it would be additional. The fact that it would be additional gives rise to the need for the draft directive, which is the second of the two instruments under scrutiny in this report.
The purpose of the draft directive is to approximate the national trade mark laws so that they harmonise with the provisions of the proposed regulation establishing the Community trade mark. The idea is that the approximation should go no further than is necessary to enable the Community trade mark to co-exist harmoniously with the national trade marks. Of course, the draft directive will have a greater impact in some member states than it will in others. It will have a particularly heavy impact in the United Kingdom and in the Republic of Ireland. The reason for that is that those are the two member states in which unregistered trade mark rights are of fundamental importance and are protected and enforceable under the common law.
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Such in the barest outline is the scheme of the two draft instruments emanating from the Commission which the House is now considering in this short debate. Let me say at once that the evidence is that the Governments of all the member states and many influential bodies, institutions and persons in the trade and industry of the Community regard the establishment of a Community trade mark as a logical and desirable development in the Common Market. Let me emphasise at the outset that this is the view of our own Comptroller-General of Patents, Designs and Trade Marks. In evidence to Sub-Committee E, Mr. Davis said:
"If one looks upon the Community almost as a single trading entity, it seems strange that one can be opposed to a Community trade mark. The problem is simply one of reconciling it with existing systems".
But there is another view strongly held—and strongly held among people who understand and have at heart the good health and future of British trade and industry. Their view can be summed up that these proposals which I have outlined are basically unsound; that they require complete rethinking and redesigning. In the light of that clear-cut and very important difference of opinion among people who really understand this subject matter, Sub-Committee E, which had the task on behalf of the Select Committee of scrutinising these instruments, sought to produce a report which would help in the onward negotiations that of necessity still have to take place over a period of years. The Committee hope that the report, of which the House is being invited to take note this evening, will assist in the further examination of these important proposals not only by the Commission but by member states, the Council of Ministers and of course by those in trade and industry directly affected by them.
It is an appropriate moment to take stock of where we stand with these proposals, for any suggestions that may now be made either in this House or elsewhere—or, indeed, by her Majesty's Government—will come at a time when they can go into the melting pot from which it is to be hoped ultimately a satisfactory system will emerge. In what has been—as is quite clear, I expect, from the sketch that I have given—an anxious and difficult scrutiny, the sub-committee has had the advice and guidance of, if he will allow me to say so, a quite outstanding specialist adviser: Professor Cornish. Professor Cornish is of international repute—and, indeed, national repute as well—in this field.
He is the author of one of the most imaginative legal textbooks that I have ever read. He has not only assisted the sub-committee in the preparation of its report, but has produced two working documents which those of us in the sub-committee who had the privilege of reading them considered to be of such importance and of such constructive assistance in the future negotiations that lay ahead that we have, with his permission, incorporated them as two appendices, Appendices A and B, in the report. Appendix A is Professor Cornish's assessment of the draft regulation; Appendix B is his analysis of the possible effect of the draft directive upon our national law. These documents deserve careful consideration even though in a short debate such as this one it is impossible to do

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justice to them. With the assistance of Professor Cornish, the sub-committee has taken a very considerable body of written and oral evidence and indeed we are grateful—as I hope the House will also feel grateful—to those who have taken the time to prepare and give such evidence.
Before it is possible to reach a conclusion as to whether the proposed Community trade mark and the system embodying it is logical and desirable, one must ask the question: are the proposals which embody the mark feasible and practical? As the work of the Committee continued, it became clear that three major problems had to he solved, and that many minor modifications to the draft instruments had to be met either in toto or by some satisfactory compromise before it would be possible to say that these proposals were feasible and practicable. The blunt fact has to be stated in order that by further work it can, we hope, be overcome; but the blunt fact is that, as the two instruments now stand. they will not do.
What is the difficulty? The difficulty is the different approach between the law of the United Kingdom and that of the Republic of Ireland and the law of other member states on the rights which we may call "trade mark rights". In the United Kingdom the registration of a trade mark is not the basic protection offered to traders who seek to establish goodwill by the use of distinctive marks in relation to goods and services. Trade mark registration—and of course one registers trade marks in the United Kingdom under the provisions of the Trade Marks Act 1938—is no more than an additional protection to that afforded by the common law to unregistered rights and registered rights as well; and the common law, of course, protects the rights, registered or unregistered, by means of the action known as the action for passing off.
We are in a field in which a lot of words are used which really mean very little to laymen and perhaps not very much to many lawyers. The action for passing off is a very simple action in principle, although infinitely complex in its many applications. It was described by Lord Halsbury in the leading case of Reddaway v. Bonham in these terms:
"Nobody has any right to represent his goods as the goods of somebody else".
It is as simple as that.
But of course what the action for passing off, with its injunctive remedies and its remedy in damages, does is to protect the actual goodwill of the trader, whether or not he has a trade mark and whether, if he has a trade mark or trade marks, he has registered them or not. As it is put succinctly in Professor Cornish's book,
"actual good will in trade is the fundamental value protected by British law".
The law of the other member states is very different in its approach. It does not approach the problem of protecting trade marks from anything like the common law stance which I have briefly described. In France and the Benelux countries and some others, what matters is registration. You get nowhere until you register your trade mark, and priority on the register is what matters. Furthermore, in these countries the use of a trade mark, once registered, cannot be challenged save by an application to declare
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it invalid or to remove it from the register. There is nothing remotely resembling common law rights.
In some member states, notably Germany and Denmark, there are rights in addition to registered rights which bear comparison with our common law. They have rights relating to the redress of unfair competition. Indeed, in Germany there is a very well-developed law dealing with unfair competition. But these instruments now under consideration—the proposed regulation and the proposed directive—are much closer to the French model than they are to the German, and their basic approach is that registration is what matters. There is accommodation, of course, in these instruments for common law rights, because the object of the directive is to ensure that the Community trade mark can co-exist with national systems; but the accommodation, in the view of those who have studied it, is not at present adequate.
Having considered the evidence, and having considered the matters which I have mentioned and which lie beneath those which I have mentioned, the Committee did reach the overall conclusion that a Community trade mark is a logical and desirable development in the Common Market; and indeed, to quote again from Mr. Davis, it would be, "very strange if it was not."
In presenting this report for your Lordships' consideration, it is my earnest hope—and here I speak personally—that, in the negotiations which lie ahead and which will begin just as soon as the views of the European Parliament are available to the member states and to the Commission, Her Majesty's Government will follow a determined line, resolved to secure that those changes which are necessary to make a Community trade mark feasible and workable alongside the British system are indeed secured—because, again I repeat, unless they are, these proposals just will not do.
I will now, if I may, mention three vital matters which have to be resolved before we can properly say that these proposals are feasible. The first matter is the protection of unregistered common law rights. The second matter on which I will touch briefly is the protection of British registered rights; that is to say, rights registered under the Trade Marks Act 1938.The third matter is the protection of service marks. We are bound in this House to be concerned to ensure that the British trader, who has unregistered rights protected at common law, will be able to exercise those rights effectively after the establishment of a Community trade mark. I will not go into detail, but I will indicate briefly those matters which require to be dealt with before we can be certain that the owner of unregistered rights will retain that necessary protection.
First, the owner of a prior unregistered right must have the right to oppose the grant of a Community trade mark. He should be in no worse position to raise an opposition than the proprietor of a registered national trade mark. And yet, under these proposals, under the draft regulation, the proprietor of a registered trade mark has the right to oppose the grant of a Community trade mark, but the proprietor of an unregistered prior right has not.
Secondly, the owner of an unregistered prior right must be given the opportunity to initiate proceedings to restrain the use of a Community trade mark

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indentical with or confusingly similar to his protected, though unregistered, mark, without the necessity of having to go to the lengths of establishing the invalidity of the Community trade mark.
At the cost of wearying your Lordships, let me tell you what the position is at the moment. In our law, with the fundamental rule being the protection of the trader's goodwill, whether his mark is registered or not, somebody with a prior unregistered right can restrain the owner of a subsequently registered conflicting mark from using that mark. Under the proposals of the Commission, that right will not be there and the two provisions which really need to be reconsidered in this context are the following. They are so important that I will quote them.
First, Article 82 of the draft regulation reads:
"Without prejudice to Article 45, the national laws of the Member States shall not apply in relation to the validity or use of Community Trade Marks."
Then the preamble and introduction to the draft directive—every one of hese words is important—reads:
"This directive excludes the application to trade marks of other rules of law of the Member States, such as the provisions relating to fair competition."
The third matter in regard to the protection of the owner of unregistered rights to which I wish to refer is that it should be clearly acknowledged—and it is not in these proposals—that, if such an owner of a prior unregistered right exercises the right which the draft regulation would give him of bringing proceedings after the grant of the Community trade mark to declare the Community trade mark invalid, it should be open to the national courts, in their discretion, to grant such a plaintiff an interim injunction against the use of the Community trade mark pending the outcome of the litigation. At the moment, if such proceedings are begun under these proposed instruments, the owner of the subsequent conflicting Community trade mark could go on using it in the course of litigation which might well be protracted, causing, clearly, very serious damage—perhaps, irretrievable damage—to the owner of the prior right.
So much for the necessity of protecting the man who has to rely on his common law rights. It is equally important, however, to protect the registered proprietor of a British trade mark. I can be short about this. The matters are important and difficult, I regret to say, to explain in a short compass, but registration in Britain of a trade mark is not the easy, almost formal business that it is in a country like France. Because France attaches importance to registration, almost anyone can get something registered. The fight begins later as to whether the registration should be cancelled, or declared invalid, or removed.
In British law, however, as I have already mentioned, the registrar has a discretion to refuse an application to register a mark which is put before him. What is important is that before he does so he is required to undertake, in the register, an official search and examination for prior registered marks. That is a peculiarity of English law not to be found in the law of other member states. It is of great value to traders who have already registered marks, because they can rely, without any action on their part, upon the registrar
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examining the register and refusing to register the later mark put forward if he finds a prior, conflicting mark. That obviates the expense and necessity of the trader himself searching the register. That will be lost under these proposals. It may be difficult to persuade our friends in the Common Market to introduce into their Community system anything comparable with official search and examination. We may have to face that possibility. Therefore, for the first time now we are looking at something which may require legislation in the United Kingdom if the Community trade mark is to come.
Not only is this official search and examination a great advantage to traders in this country; it will also present them with a genuine obstacle if the Community trade mark comes. The official search and examination is only one reason why it is more difficult to get a British registration than it is to get, for instance, a French, a German or a Belgian registration. Since registration will be the linchpin of the Community trade mark, this means that it will be easier than it is here to get yourself into a position to preserve your rights or to attack other people's activities if you register in the Community register or in a Continental register. You may not be able to get yourself registered here, whereas you would be able to get yourself registered abroad. This may indeed be an obstacle that we should seek to eliminate if these proposals are to come. If we cannot persuade, as I think it may be impossible to persuade, the Commission and other member states to introduce official search and examination into their systems, we may have to consider legislation so as to produce a system of registration nearer to that in use in the Continental states.
The other matter where it is necessary to secure protection for the owner of a registered right is that under these proposals a prior trade mark owner will lose his right to object to a conflicting later mark if he acquiesces in its use. This is a sound principle, but it must he made clear that by "acquiescence" is meant acquiescence in the use of a mark in the state or states where the owner of the prior mark trades. It would be quite absurd, and unjust, to expect of a trader who trades only in, let us say, member states A and B that he should be on the lookout as to what is going on in member states X, Y and Z. Of course, where others are using a trade mark in competition with his goods, then he must act or lose his rights, but it should not go further than that.
The third matter—and I apologise for the length of my speech but take courage from the fact that there will not be many speeches this evening—is the need to protect service marks. There is a very serious omission in our law. We protect registration marks applied to goods but not marks applied to services. In 1974, the Mathys Committee recommended that our law should be amended so as to cover services as well as goods. If we enter a Community trade marks system without having put our house in order and without having gathered into the folds of the Trade Marks Act 1938 protection for service marks, a large and developing section—largely the high technology sector—of British trade, industry and business will be at a serious disadvantage compared with Continental competitors. I will not take time on this but commend to Her

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Majesty's Government favourable consideration of the Bill introduced by the noble Lord, Lord Campbell of Alloway, recently in your Lordships' House—the Trade Marks Act 1938 (Amendment) Bill, the object of which is to extend registered trade marks protection to service marks.
How stands it at the end of the day? The committee accepted—and I hope that your Lordships' House will endorse its view—that, notwithstanding the difficulties which I have been at pains to outline, a Community trade marks system is logical and desirable, but it will not be feasible or practical unless solutions are found to the problems I have mentioned; and unless modifications into which I have not been able to go in the time at my disposal along the lines sketched by our specialist adviser in Appendices A and B are sought in the negotiations which are about to start, and they or something similar are obtained. There is also undoubtedly a need, if we are to enter into a Community trade marks system, for some United Kingdom legislation in due course: legislation dealing with the difficulties of registration and with the problem of official search and examination; and legislation dealing with service marks.
I conclude by reminding the House that there is a fear among British business people that we may be exchanging the swift, simple and relatively inexpensive remedies provided by the Trade Marks Act 1938 for something that will prove slow, costly and, in one specific respect, disadvantageous to those who have to rely on their common law rights. These fears can be dispelled only by a determined conduct of negotiations on behalf of British interests in the negotiations which are to begin, along the lines indicated in the report. If they are, it can only be to the benefit of the whole European community, for the result will be a Community trade marks system which is satisfactory to all member states whatever the differences in principle of their own national laws. My Lords, I beg to move.
Moved, That this House takes note of the report of the European Communities Committee on Trade Marks (1st Report, 1982–83, H.L. 21)—(Lord Scarman).
9.25 p.m.
Lord Mishcon: My Lords, from these Benches I wish to pay a tribute—and I am sure I speak for all your Lordships—to the excellence of the report we are now considering, and to the typically lucid and forceful manner in which it has been introduced by the noble and learned Lord, Lord Scarman. He has the great ability, blessed as he is with that logical and clear mind, accompanied by such felicity of language, to address us on the most complex subjects in such simple and intelligible terms, and he has done that for our general benefit this evening. In adding the membership of Sub-committee E as recipients of our gratitude, I can do so without any immodesty, because, through other duties in your Lordships' House, I was unable, as a member of that sub-committee, to participate in the preparation and approval of this particular report.
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There is no doubt about the importance of this matter to our trade and industry. Trade mark laws, as the report says,
"underpin the goodwill that the trade mark owner builds up as he actually uses and advertises his mark".
There are obviously conflicting pressures upon those laws in which a balance has to be struck: those of the new entrants into a market who want quickly and cheaply to test whether they are blocked in their proposed user and who also want to get their protection before they have got far with their particular product; there are contrary pressures from those who have existing trade marks and who want to make sure that their protection has not been watered down. A
fortiori, holding the balance, as has been particularised for us so clearly tonight by the noble and learned Lord, in attempting harmonisation between the laws of different nations within a community of nations, is even more difficult, not least because of the different emphases, aims and legal traditions of the respective countries in regard to this subject.
As a major example of this, we have, as the noble and learned Lord emphasised, built up in our legal tradition, in our legal system, a common law protection, quite apart from the statutory trade mark registration commenced in 1875; that is the action known as the passing off action. I quote, if I may, the alternative definition in the report to that of Lord Halsbury to which the noble and learned Lord drew our attention:
"It protects the reputation of our established trader against imitations which would tend to lead purchasers into believing that they were getting his goods or services which they were not".
Denmark, Italy and West Germany tend to be like us in this respect. France, Greece and the conjoint Benelux system regard the fundamental factor as registration, as against use.
We are indeed faced with a complex task when we look at harmonisation and the setting up of a Community register. This report, if I may say so, has made a monumental contribution to helping us to get to grips with the problems so vividly outlined to us by the noble and learned Lord—which I therefore do not intend to repeat, especially at this hour—and to giving us guidelines so that, in the negotiations ahead, we can try to give adequate protection to our own people.
Apart from the most useful evidence which the committee obtained from all those intimately concerned, the report contains pointers which are of great import. The appendices to which the noble and learned Lord, Lord Scarman, referred are particularly helpful, and I am glad that he paid such an eloquent tribute to the specialist advisers' assessment of the draft regulations and directive in the light of that evidence which forms Appendix A. After going into the difficulties created particularly for this country by the absence of any search or examination in the proposed Community Register, Appendix A deals with the issue so constructively and incisively, in paragraphs 55 to 57, that I take the liberty even at this hour of quoting a part of paragraphs 56 and 57 of the appendix to which I refer:
"The proposed Community system would give industry a single alternative means to eight national registrations for securing a trade mark that has effect throughout the Common Market. The system will become self-financing unless perhaps it proves to attract very

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little custom. While there is no way of predicting accurately how much it will be used in preference to the existing national systems, or what it will contribute to lowering trade mark barriers within the market, it is likely to contribute something significant towards the major objectives seen by its proponents, even if it does so only gradually.
From a British perspective, however, the introduction of a Community alternative built upon different premises from those of the national system could be a source of disruption and misapprehension to British business which would incur costs over a substantial period of time. In particular, the absence of any search or examination in the Community system would throw upon those with registered rights the need to monitor Community applications for later conflicting proposals. As already suggested, if this came about, the British would probably be drawn to consider whether the national system should not be similarly adapted. That would be a major change and one quite contrary to the strong recommendation of the Mathys Committee in 1974. It presents a problem hut for which the Commission's plans, if suitably amended in detail, could be unequivocably endorsed".
Reference should also be made, though I shall deal with this in one sentence only, to Appendix D, which sets out in such admirable detail the potential effect of the directive on existing British trade mark law. I am quite sure that British industry and commerce will be very much in the committee's debt. I should indeed have said in the debt of your Lordships' House as a whole, for, without this House and without this committee of your Lordships' House, much of this, or indeed similar vital work in the EEC field, would never be done.
I wish that I could be as complimentary to the Government as I wish to be to your Lordships' House and to the committee. I am so glad that the noble and learned Lord referred, in his usual moderate terms, to the matter about which I want to say a few words in conclusion. The draft directive and regulations presuppose a trade mark not only for goods but also for services. When the regulations and the directive become effective, those with national registration of trade marks for services will have certain essential rights. Those who have not, will suffer.
We do not have registration of trade marks for services, and your Lordships have been reminded by the noble and learned Lord, Lord Scarman, of the short Bill recently granted a Second Reading in this House and which on Wednesday of this week is to have its Committee stage. It was introduced as your Lordships have been told, as a Private Member's Bill by the noble Lord, Lord Campbell of Alloway, who I see with pleasure is to speak later on in this debate. The Bill aims to protect our vital service industries and to give us some important experience by providing for registration of trade marks for services in line with the recommendation of the Mathys Committee which reported many years ago. The Government's response on the Second Reading of the Bill was negative and unhelpful in the extreme.
The Government advocated through the courteous voice of the noble Lord, Lord Lyell, a dangerous delaying policy when the Government must know that waiting can well be disastrous for the service industries and put them at a grave potential risk and disadvantage. I had to say then, and I in no way retract that statement, that I regarded the speech of the noble Lord, Lord Lyell, on behalf of the Government on that Second Reading as nothing short of disastrous. I appeal to the Government—and I hope very much that the appeal will be successful—supported on this
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occasion, as the Government will note, by the voice of the noble and learned Lord, Lord Scarman, on the Cross-Benches with all the authority that he commands, that they should think again upon this very important matter and give the support to the Bill of the noble Lord, Lord Campbell, which it so much deserves.
I conclude by again expressing our appreciation of the excellence of this report to its authors and in particular to the noble and learned Lord, Lord Scarman.
9.38 p.m.
Lord Renton: My Lords, first let me say that I am very glad indeed that the noble Lord, Lord Mishcon, said what he did about the importance of the Bill which has already been given a Second Reading in your Lordships' House, introduced by my noble friend Lord Campbell of Alloway. I should make it clear at the outset that I am not quite so hopeful, as was my noble and learned friend Lord Scarman and the noble Lord, Lord Mishcon, of this draft directive and these draft regulations being capable of adaptation in such a way as to make them acceptable in this country. I think that there are some fundamental difficulties and I shall be referring to them.
I have sat for the past two Sessions, and still do, at the feet of the noble and learned Lord, Lord Scarman, in Sub-Committee E. Most of our work has involved the scrutiny of draft directives and draft regulations issued by officials of the European Commission in Brussels in pursuit of their laudable aim of approximating, under Article 100 of the Treaty of Rome, some very different laws of member countries. It has been a complex and difficult task for us to scrutinise those drafts, but we are indebted and grateful to the noble and learned Lord, Lord Scarman, for his prodigious energy in mastering them and for the clarity with which he has led us through those vast labyrinths. Sometimes I must confess that it has been a rather turgid task.
Although Article 100 of the Treaty of Rome refers to "approximation" of laws, the word "harmonisation" has come to be used more often to describe the process. But it seems to me that those two expressions have different meanings. "Aproximation" means something not far short of assimilation in our language and I think in the French language, in which the same word was used in the original draft. But "harmonisation" presumably means something less, something different. It means the elimination of conflicts between laws and legal systems which are at variance with each other, so that trade may flow more smoothly through the Community.
There is a valuable work available in the Library of your Lordships' House called the Oxford Companion to Law, the present edition being that of 1980. It says:
"Harmonisation of laws is an alternative to approximation. In English approximation goes further than harmonisation or co-ordination, but falls short of unification".
In the Oxford English Dictionary one finds that "harmony" is mostly a musical term but, to the extent that one can find a current meaning for it, it means "consistency" in this context or the "process of making consistent".

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On most of the occasions on which we have had to consider their drafts, the gentlemen in Brussels have expressed them as being "in order to approximate". But if they really are attempts to assimilate, as I have sometimes suspected that they are, then instead of creating harmony and removing conflicts, they may even cause conflicts. It is in that context that I think we need to examine this draft regulation and draft directive, and with that danger in our minds.
The problem here—and it has been referred to by the noble and learned Lord Lord Scarman, and the noble Lord, Lord Mishcon—is that in the EEC there are three distinct systems affecting trade marks. Of course, each system covers only part of the EEC. I need not go into the details of these three systems because they are well set out early in our report in our comments in paragraphs 5 to 8 inclusive. One must bear in mind that the traders in each system have not only become accustomed to the way in which it works, but have acquired rights which they will never willingly relinquish.
In paragraph 72 of Appendix A we find that our splendid expert has pointed out that, in so far as it interferes with rights, the draft directive may be in conflict with Article 222 of the Treaty of Rome. The gentlemen in Brussels recognise the difficulties and so, instead of trying either to approximate or even to harmonise the three systems, they have introduced a fourth system to cover the whole of the Community—this Community trade mark—while leaving the three systems to go on operating each in its own limited sphere, unless it conflicts with the new and fourth system of the Community trade mark.
Of course, that in itself involves problems of reconciliation in order to enforce the Community trade mark. We are up against this problem, that the Community trade mark involves a form of registration which confers its own rights which will have to be protected on a Community basis. In order to ensure that that is effective, each country will have to alter its laws in order to incorporate what are described in paragraph 18 of our part of the report as the five techniques for adjusting conflicts between earlier and later claimants to similar marks.
Unfortunately, those five techniques do not adjust the conflicts. I venture to say that they even create fresh conflicts. We recognise this. We have pointed it out in paragraph 36. As the noble and learned Lord, Lord Scarman, has mentioned, there are two problems. We feel that full protection should be given
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to common law rights which in our country are enforceable by passing off actions and which traders will not relinquish—the bone is in the dog's mouth; they will not let it go.
Secondly—this is a very serious problem to overcome—the proposed new Community trade mark system would make no provision for official search for prior conflicting registrations, nor would it make provision for an examination based on such a search. The result would be two alternative systems operating in the United Kingdom for registering rights. Each of those systems would be operating on different principles. It would be chaotic.
We have also seen in the draft directive and regulation, and in giving evidence, that those concerned have conceded harmonisation in this matter is not their aim. Indeed, it could not be an aim in the way they put it forward. What has not been mentioned by them, as far as I remember, is that by superimposing a new system of registration for the Community as a whole further disharmony would be created. it would be a self-defeating exercise. Therefore, it follows, in my opinion—I am speaking personally—we should advise Her Majesty's Government not to agree to the drafts as they stand. As I have said, I seriously doubt whether they could be made more satisfactory and acceptable to the United Kingdom, if they were amended. But one must be candid. There would obviously be advantages as the noble and learned Lord, Lord Scarman, has pointed out, and as we say in our report, if—and it is a very big "if"—a suitable Community system could be contrived and introduced which did not give rise to conflicts which I have mentioned.
It is tempting to say that in our country we have registration of patents which works well and is self-sufficient; they stand on their own without common law rights to enforce them. We have over a large part of the country registration of ownership of land and titles to land and over land. To the extent that we have it, that works well also. A European may very well say, "What are you fussing about? In some spheres you have got very well used to registration; you have shown that it works".
But that is not all in this case, because we have these common law rights which we find work smoothly, with our rights of ownership within the meaning of article 222, and we cannot lightly disregard them. Therefore, although this is an important matter, and in a perfect world and uttering a counsel of perfection one could wish that there could be something better in the Community, in my own humble, respectful opinion I do not think that the proposals in the draft directive and draft regulation provide the answer.
9.51 p.m.
Lord Lloyd of Kilgerran: My Lords, I also should like to congratulate the noble and learned Lord on his speech and on having chaired Sub- Committee E with his usual charm, competence and remarkable insight in dealing with basic problems—on this occasion international problems associated with the development of Community trade marks. There is no doubt that his long and lucid speech this evening and his report will be read with great interest throughout the Community, and indeed throughout the industrial world, as an important contribution to progress in the long history of trade mark discussions on the European trade marks, which have already lasted over two decades.
I agree with the noble and learned Lord, Lord Searman, that the sub-committee were very fortunate indeed in having had the services of such a distinguished lawyer as Professor Cornish as their specialist adviser. I have no hesitation in saying from my experience of these international trade mark matters that Professor Cornish's two papers, already referred to, are themselves alone a great contribution to progress in this difficult field of European trade marks. But, as the noble Lord, Lord Renton, has indicated, there are profound difficulties.
The evidence from United Kingdom industry submitted to the committee was most discouraging to those who wished to see an EEC trade mark adopted in industry in the near future. Most witnesses, as the noble and learned Lord said, supported the theory of having one trade mark for the EEC, but all from industry rejected the present proposals. Thus, at page 45, the representatives of the Chartered Institute of Patent Agents, who are in close touch with UK industry, submitted that the proposals were quite unacceptable. At page 53, the Institute of Trade Mark Agents thought that with appropriate amendments there could be a workable system.
It is perhaps significant that only three companies gave evidence directly to the committee. Thus the Wellcome Foundation, in an interesting memorandum at page 142, stated that the British industry and commerce does not need new experimental ideas in the field of trade marks, but rather requires to be left alone with existing concepts which should be made to work more consistently. At page 143, British-American Cosmetics Limited, owners of over 1,200 trade marks in the EEC, were wholly against the EEC trade mark registration system as it stood. The Mars Group of Companies, in a long memorandum at pages 121 to 130, suggested that the proposed legislation in theory was acceptable, but that it was conditional upon the adoption of a large number of amendments. I thought that the memorandum of the Association of the British Pharmaceutical Industry at page 106 was particularly helpful. This UK industry has a vast export trade. The association's view was that the present drafts should be entirely abandoned and rewritten, as they were totally misconceived in the context of British industry.
At the beginning of his speech, the noble and learned Lord, Lord Scarman, mentioned the long history of international discussion on trade mark matters. As I have indicated, to my personal
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knowledge they have lasted over 20 years. Many of us take the view that much of this history ranks so far as some of the most boring and useless in the history of any jurisprudence.
To add a personal note, I have with me a small book of 100 pages which enshrines speeches made in Washington DC on 10th and 11th November 1962, over 20 years ago, at a conference called by the Georgetown University Law Centre to discuss the then proposals for a European trade mark convention. Georgetown University invited seven lawyers from countries of the EEC, and I had the honour of being asked to give the British view relating to the then Common Market law, which seemed to he understandable in that period.
The basic European trade mark model at that time had been prepared largely by a German lawyer, an old friend of mine, Dr. Rotsche, who, at the conference, had been designated father of the Common Market trade mark, which was then expected to be born very soon. Unhappily, however, that was not to be the position. After discussing aspects of the proposed convention, I said:
"Once the basic principles of the unique form of trade mark rights are understood, it should not be difficult to formulate a European trade mark law which will not hamper or restrict unnecessarily the commercial activities of the business world".
I concluded my speech on that occasion—when a welcome was given by all lawyers to that trade mark convention of 1962, which then we all understood and thought would be practical and useful to the Community—by quoting (I apologise if I am taking up your Lordships' time, but I think these words are very relevant) almost as a warning from some of the lectures given by the late Lord Radcliffe, in Illinois in 1960 under the title, "The Law and its Compass". This is a passage which, as I said then and believe today, still indicates in general terms the basic approach towards drafting the new trade mark law:
"Law needs at all times a compass to steer by. I hope I do not say anything impertinent if I say that it is not lawyers themselves who are most conscious of this need. It is possible to perceive that the lawyer often stands too close to his subject to see clearly in what direction he and his fellows are going".
lie concluded by saying:
"What drives us back from time to time to search further, to question outright what are our purposes, is the insistence of the layman"—
I interpose by saying that I would include on this occasion British industrialists—
"the man who is not versed in law, but who stands for something more, for some indication of a sense of right and wrong that is not merely provisional or just the product of historical proceeds".
In the light particularly of the reports of Professor Cornish to which I have referred, I suggest—and this is my personal view—that it would be helpful now if United Kingdom industrialists were to take up the initiative in this matter of an EEC trade mark law to ensure that something may be produced which will not hamper or restrict unnecessarily the commercial activities of the business world. I mention to the Government that there is a danger that British industry may have foisted upon it a trade mark law which, even in the long term, will be a source of disruption and great expense, and will be damaging to industry.

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I should like to echo the concluding remarks of the noble Lord, Lord Renton, when he wondered whether it was wise to proceed further in the near future with EEC proposals of this kind. Naturally, one does not wish to introduce any political atmosphere, but I think it worth quoting the view of the committee to be found on page xxxviii. The committee state—and I commend the passage to the Government:
"The uncertainties surrounding the effectiveness of a Community mark system go not so much to the legality of the proposal as to the political wisdom of establishing it at this stage of the Common Market's development".
10.1 p.m.
Lord Campbell of Alloway: My Lords, like other noble Lords, I wish to congratulate the noble and learned Lord, Lord Scarman, and the members of the Select Committee, in particular all those who have already spoken in this evening's debate, on the report. As has been truly said, it is a monumental contribution to the subject. I should also like to thank in particular the noble and learned Lord, Lord Scarman, for his authoritative endorsement of 'the need for the Trade Marks Act 1938 (Amendment) Bill to protect our high technology and our service industries. Further, I wish to thank the noble Lord, Lord Mishcon, and my noble friend Lord Renton for the kind and constructive things that they have said in this regard.
The report is of vast importance to industry and consumers, for these symbols of competition—trade marks—are designed to avoid imitation, eliminate confusion, underpin goodwill, and afford a measure of consumer protection. As usual, we Anglo-Saxons are the odd men out so far as our Napoleonic Code partners are concerned. As has been explained, far more eloquently than I can explain it, by the noble and learned Lord, Lord Scarman, this is because the registration system for trade marks developed from the common law of "passing-off", and both systems operate side by side, giving primacy to reputation which is established by use.
So the question is, whether to set up a Community trade mark for goods and services which is unitary throughout the European Community; whether we should accept the proposed régime, which conflicts with our own law, and so involve by the directive amendments to our own law to ensure that both systems remain in step. We are concerned here with what was referred to by the noble and learned Lord, Lord Scarman, as the "heavy impact of the directive"—a graphic and accurate description.
In my submission the draft regulation and directive are unacceptable without substantial amendment. The case for the amendments—and I say this in order to be brief—is made out with compelling clarity in paragraphs 36 to 38 of the report. Some are of fundamental importance, such as paragraphs 36 and 38(a), which involve a basic amendment of Article 7 of the regulations to allow opposition to the grant of a Community trade mark based on common law rights, as distinct from prior registration under national law; as has already been said, the only priority claim acknowledged, for example, in France. Other amendments are of minor consequence; such as, for
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example, paragraph 37(a) where changes of detail are required in connection with the rights conferred by a registered trade mark. But there is also the important question, and the very difficult question, of injunctive relief. This is neither the time, nor, I suspect, the place, in which to consider the difficulties that arise in that connection. But I point to them so that my noble friend the Minister may perhaps take aboard that there is a very serious difficulty that arises in connection with injunctive relief on which no doubt his department will advise him in due course.
Although it is not the object of these proposals to harmonise national laws, as far as we are concerned, that would be the effect, resulting in very substantial amendments. It is wholly idle to pretend to the contrary. No doubt in the long run there will have to be a measure of compromise. Other member states have their problems in this sphere—but not as great as ours. If compromise reflects the art of negotiation, then this report provides the essential material. If the reality of the situation is—and here, with the utmost respect, I differ a little from the approach of my noble friend Lord Renton; and your Lordships may think that it is the reality of the situation—that sooner or later we shall have to compromise, so be it. But I am approaching it from a slightly different angle from the equally tenable intellectual approach of my noble friend Lord Renton.
I am approaching it from the problem that the reality of the situation is that sooner or later we shall have to compromise, that this report is gold dust because here is the material for our negotiators to use when they seek to negotiate to achieve the compromise; so that at least our Ministers shall go to the negotiating table armed not just with some departmental brief but, one may also hope, with your Lordships' unqualified approval of the reservations contained in this invaluable report and that they, our Ministers, shall heed this warning that the two instruments as they stand will not do.
10.10 p.m.
Lord Lyell: My Lords, I am sure that the whole House will agree that we have had an outstanding debate this evening. Speaking for my own part as one of the non-lawyers to have my name on the list of speakers this evening, it has been a privilege and a pleasure to hear such a massive and complicated subject so excellently and cogently described for us by such a leading expert as the noble and learned Lord. Lord Scarman. It has been a tremendous education to your Lordships and, I may say, to Government spokesmen who appear from time to time in this position when—as has been pointed out by several of your Lordships this evening—all is not necessarily sweetness and light on this particular subject. I shall spare my comments on the various criticisms that have come my way in respect of my earlier deeds at this Box. I shall have a few words to say about them later.
I hope that your Lordships will hear with me if I preface my remarks on the report which is before the House this evening with one or two general observations on the subject of trade marks since we believe in setting forth the Government's position on

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this complicated, important and difficult subject at the outset. As I am sure noble Lords are aware, trade marks play an important part in the commercial success of many companies, both large and small, in the United Kingdom by providing that vital link between the goods or services on offer and the customer. Satisfied customers will look for the same trade mark when they make future purchases. Because of this a company can found its marketing on a trade mark which may consequently acquire real commercial value in its own right.
Clearly if the system is insufficiently secure to prevent unauthorised people from using the trade mark, there will be various adverse effects. Not only will the company lose sales but its reputation will be damaged. The consumer too will suffer by not receiving the goods he expected. Hence the importance of trade mark protection for companies and consumers alike. Any proposals therefore for amending our trade mark laws must be examined with the greatest care—as indeed they have been in the report which has been presented under the aegis of the noble and learned Lord, Lord Scarman. With this care in mind, we unreservedly congratulate the Select Committee for the careful attention they have given to these proposals for a Community trade mark system.
As your Lordships will be aware, every country in the European Community has its own system of trade mark protection effective in its own territory—a British registration, for example, is only effective in the United Kingdom. This proposal for a Community trade mark has an altogether broader scope. It treats the Community as a single market and allows a trader to get a registration which is both effective and is protected throughout the Community. Of course, the Community mark will not transform the Common Market overnight; but it will be another step in the direction of a unified market.
Goods carrying a Community trade mark will circulate freely thoroughout the Community, and traders will therefore be encouraged to think of the Community as their domestic market. Thus, we fully support the view that a Community trade mark is a logical development of the Common Market.
At the same time, it is clear that there will be a continuing need for our national system. We have heard that reiterated time and time again this evening with great strength and great clarity. There is a high proportion of companies which trade in a single country, and they will therefore be interested in national trade marks only. The Community trade mark, therefore, will need to co-exist with the national systems of the individual member states. These national systems differ from each other in the scope of the exclusive right granted and in many other respects, and this could obstruct the free flow of goods. This point alone calls for the harmonisation of national trade mark laws in the Community, and this is sought by the directive.
One more reason for the directive is to reduce the anomalies that could exist between Community trade marks and national trade marks, which could well cause difficulties for traders. It has been argued at various stages, though not necessarily in your Lordships' House, that it is sufficient to harmonise the various national laws and that the proposal for a
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Community mark should be shelved until more progress has been made towards an integrated market. No doubt every Community proposal meets the same response, but the Community trade mark is itself a factor in integrating the market. It is a way in which such progress can be made. The Community trade mark will certainly not come about tomorrow, and I am sure that now is the right time to be looking at these proposals and identifying the problems which exist, as has been done with great clarity by this report, and working towards a system which is acceptable to everybody.
Perhaps I may now consider some of the major issues dealt with in the report. I hope that your Lordships, and indeed the noble and learned Lord, Lord Scarman, will forgive me, but it would be impossible at this hour, and indeed virtually impossible without an endless peroration, to cover all the major and important issues bound up with this subject contained in the report.
As your Lordships will have noted, the report concludes that a Community trade mark system is feasible, subject to certain fundamental difficulties being overcome. The first difficulty which has to be overcome is the need to give full protection to common law rights. It was most gratifying to hear the forthright declaration of the noble and learned Lord, Lord Scarman, on this subject. Perhaps I may explain at this point that the owner of a trade mark in the United Kingdom can acquire rights in two different ways. In the first way, mere use of the mark gives him rights at common law—the so called "passing off" rights. In the other way, he can acquire rights by registration. When a trader acquires a mark, he acquires the right to prevent others from using his mark and, in addition, a number of other rights as a result of its use.
The first problem that we encounter with the regulation and the directive is that they would deprive the proprietor of a registered trade mark of these additional rights. This would have very serious consequences throughout the Community and, as a result of representations made by us to the European Commission, it is clear that the draft will be revised in order to avoid this situation.
One more difficulty raised by the report, still dealing with common law rights, arises because the regulation would not permit the user of an unregistered trade mark—a trade mark which has only common law rights—to oppose a later application for a Community trade mark. He would need to wait until the application had been registered and then would need to seek invalidation of the registered mark. All this would take time and, frankly, because of the increased difficulty in removing a mark from a register as opposed to its becoming registered, would place the user of an unregistered mark at a considerable disadvantage.
We have also made proposals to the Commission in order to safeguard the position of the users of unregistered marks. These proposals, I am glad to say, have been well received by other member states. We look forward to seeing amendments to the regulation to meet this most important point.
Perhaps I may refer at this point to the problem of service marks, which is tied up with the Bill of my

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noble friend Lord Campbell. The Government did not support my noble friend's Bill at the Second Reading just before Christmas, on the grounds that the time was not ripe, having regard to the present Community proposals and the current state of the trade marks registry. If the draft proposals are amended to give full protection to common law rights, as urged by the report, many of the fears voiced by users of unregistered service marks would disappear. If these are not amended, as we have urged in Brussels, then we shall have time to consider what precisely should be done.
So far as the trade marks registry is concerned, at the present time there are serious delays in processing new applications. This is a very severe disadvantage for British business, and we are making very strenuous efforts to improve the position. But it would not help British business, nor would it help the registry, to, perhaps, double the delays by adding service marks to the statute book at the present time.
Lord Mishcon: My Lords, before the noble Lord the Minister continues and because the House is so anxious, as has been made clear in this debate, could he tell the House why the Government could not consider support for a Bill which would contain a starting date for registration which was sufficiently far ahead to enable the clearing up, which he thinks is a barrier in the trade marks registry at the moment, to take place?
Lord Lyell: My Lords, if the noble Lord believes that my noble friend's Bill meets the criteria that he mentioned, I hope that I have given a preliminary answer as to why we were not able to support it. If I am correct in assuming that the noble Lord wishes me to give further reasons why we could not support my noble friend's Bill, perhaps he could wait, because we are going to deal with it in two days' time. But if he is asking a further question which is away from my noble friend's Bill, or is about wider powers, then I am afraid that I could not give him an answer tonight. Perhaps I may study his remarks and write to him.
Lord Mishcon: My Lords, I hope that the noble Lord will not think I am too persistent. I was not, in fact, mentioning a point which he had not himself brought to the attention of the House as a reason for not supporting the Bill, and that was the present congested state of applications in the trade marks registry. If the noble Lord the Minister wishes to take time to consider the remark and cannot answer tonight, then, of course, I shall be courteous enough to bow to that. But what I am asking him specifically is: if this is one of the points that he wishes to bring into this debate, could he inform us why the Bill could not have support with a starting date for registrations which takes into account the relief of the congestion which is now taking place?
Lord Lyell: My Lords, I shall certainly have to write to the noble Lord, because we are treading over the ground that was covered extensively by many of your Lordships on 22nd December last year. But I can assure the noble Lord and your Lordships that I shall read carefully what he has said, and I hope that I may
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be in correspondence with him. But I could not go further on my noble friend's Bill than I have gone tonight in relation to this debate on the noble and learned Lord's report.
Lord Campbell of Alloway: My Lords, would the noble Lord—
Lord Lyell: My Lords, if the noble Lord will be brief.
Lord Campbell of Alloway: My Lords, I am always brief. Could the noble Lord consider why this should be the seventh excuse that Her Majesty's Government have given for not introducing service marks legislation and why, if it is a good excuse, and a genuine excuse, it was not produced before?
Lord Lyell: My Lords. I do not have the Hansard for 22nd December with me, but—
Lord Campbell of Alloway: I do.
Lord Lyell: My Lords, the noble Lord says that he does, but I beg him and the House not to cover again all the ground that we covered on 22nd December. We are going to have a chance to do that on Wednesday. So far as I am aware, this problem of congestion did arise. I think that I may well have mentioned it, but I do not have Hansard with me.
May I, however, attempt to answer the question which has been raised by the noble Lord, Lord Mishcon? If I only skirt around it, I hope he will forgive me; I shall complete my answer in writing. I am informed that if a consensus emerged that the present British system of search and examination could not exist side by side with the Community system and that as a result the British system should be abandoned, we believe that there would be no sense in setting up an expensive search and examination system for service marks now, only to disband it again in a few years' time. That is a preliminary answer to the question that has been raised by the noble Lord, Lord Mishcon. I promise that I shall study the full thrust of the noble Lord's fairly weighty questions. During the two interventions which he made, he covered a number of points. I shall certainly read Hansard with great care and will write to the noble Lord.
I revert to the report which is before us this evening and turn back to the second major difficulty which was referred to in the conclusions contained in the report. It concerns the contrast between the British system, which involves a search and examination based on the search, and the proposed Community system, which makes no such provision. To put it plainly, the United Kingdom system is based on the public interest. That is to say, a careful search is made through trade marks already registered and we will not register a mark which conflicts with one already on the register. Over the years, this search has come to be regarded as extremely reliable. This is a great advantage to commerce in this country. If a firm applies to register a mark and nothing is found in the register, it is reasonably safe for the firm to go ahead and base its business on that mark.

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Unfortunately, in connection with the Community mark, a complete search would involve eight national registers. Some of these registers are, to say the least, of uncertain accuracy. In any case, they involve several different languages. The problems involved here are probably insuperable, although we would not say that definitely. For this reason, the system adopted for the Community mark is one in which owners of existing marks must protect themselves by keeping track of what is being placed on the Community register, and opposing as necessary. The report touches on this point and indicates, quite properly, that a state of possible confusion of marks in the market place is not a good one. They refer to the need for an acceptable solution.
There is no perfect solution, but I am sure that your Lordships would wish to know that we have already proposed adopting a British type system as regards Community marks. That is to say, prior Community marks at least should he searched to ensure that Community trade marks do not conflict with one another. In the long run, it may be that computerisation will offer the possibility of comprehensive searching of all national and Community marks, but of course we are not there yet.
As the report points out, we would still have the problem that there would exist in the United Kingdom marks on two different registers. A mark on the national register could be presumed valid, in view of the strict national procedures prior to registration. On the other hand, a mark on the Community register would not have the same presumption of validity. Of course this is a far from ideal situation. Whether these two systems could co-exist happily is difficult to say, but, if the number of Community marks ever became a significant proportion of the total number of registered marks used in this country, then attitudes to the necessity of searching for British marks would very likely be changed.
There is one further matter which is not dealt with by the report but which I feel I should draw to your Lordships' attention because of the concern of industry. This is the effect of the directive on existing registered trade marks. The purpose of the directive is to ensure that trade marks enjoy uniform protection under the legal system of all member states. This is perfectly feasible for post-directive marks, but we have considerable doubts about applying the directive to existing marks—in other words, making the directive retrospective in application.
The directive will have the effect that it will change the rights attached to certain marks, and therefore perhaps bring into conflict many existing rights on which long-established business and commercial dealings are based. The effect of the directive could well be to disrupt well-established trading patterns without any compensating advantages. If I mention that there are at the moment 250,000 trade marks on the British register, your Lordships will appreciate the size of the problem. Your Lordships will also gather that we are not at all convinced that making the directive retrospective is at all necessary.
The report raises a number of other points of detail and in general the Government would not dissent from the conclusion arrived at. However, we will just raise a note of caution on the fascinating issue (to a layman
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at least) of international exhaustion. Under the proposals, if a manufacturer sells trade marked goods in one country, he may not use his trade mark rights to stop a third party from buying up those goods in the first country and re-selling them in a second country. That is to say, once the goods have been sold in one place, the trade mark right has been "exhausted". This principle of exhaustion of rights already applies within the Community and arises out of the free movement of goods principle of the EEC Treaty.
This seems fine when applied to the Community. However, the proposals would extend this principle on a worldwide basis, subject to certain exceptions. The report concludes that the list of exceptions is inadequate to safeguard British industry and it proposes some additions to the list. It is not immediately clear that the unilateral adoption of this principle of international exhaustion by the Community would be of lasting benefit unless our non-Community trading partners were to do the same. Situations may arise where our Community industries would be disadvantaged by cheaper versions of their products coming into the Community, without the compensating advantage of cheaper versions of Community products being free to flow in the opposite direction. We shall need to look very carefully at the list of exceptions to ensure that Community industries are not disadvantaged by the adoption of such a principle. Indeed, we shall look at the principle itself; it may be that exceptions are not enough.
Your Lordships will also be aware that this Community trade mark proposal envisages the establishment of a Community trade marks office to deal with the applications. The Government have proposed London as the home of the Community trade marks office, and I would like to take the opportunity of repeating that proposal most forcefully this evening.
Your Lordships will be aware—as will anyone who has attended this debate or who reads it in Hansard—that the United Kingdom has a long tradition in trade marks, both nationally and internationally. Our trade marks registry is one of the oldest in the world, and, as the trade mark lawyers among us will know, it is situated nearby, in Chancery Lane. It is surrounded by a wealth of expertise in trade mark agents, patent agents and specialist lawyers. London is firmly established as one of the most experienced centres for trade mark activities of any city in the world and in our view would provide an ideal home for the Community trade marks office.
I have taken the opportunity of doing a little advertising and giving a gentle "plug", even at this late hour, for our great City of London. But, returning to the report itself, I will attempt to answer some of the points made by your Lordships. If I miss any, I assure your Lordships that I shall read Hansard very carefully; and I will certainly write to the noble Lord, Lord Mishcon, who raised a point of substance.
The noble and learned Lord, Lord Scarman, and the noble Lord, Lord Mishcon, both made powerful speeches. The only comment that I had before I stood up was, "My noble friend's Bill—nothing to report." Alas! that has been changed since I got to my feet. But I have nothing to add beyond what I have said this

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evening; we shall be coming to my noble friend's Bill on Wednesday.
My noble friend Lord Renton added—if I may put it this way, in all humility—very much "the Lyell touch" to our deliberations this evening. He spoke for me when he mentioned that he considered the attitude of traders to be that of "dogs with bones in their mouths". I do hope we shall be considering paragraph 36 in the main report as "the bone in the mouth report", and it might become as famous as the Terrapin v. Terranova case, let alone Hoffman Laroche v. Centrafarm BV, also mentioned in the evidence. I believe that the touch of my noble friend Lord Renton brought this subject of trade marks as it affects traders really to life in your Lordships' House. We also note the strong recommendation not to accept the regulation or directive.
Lord Lloyd of Kilgerran made his apologies to me and my noble friend and I pass them on to your Lordships; he had a train to catch. He quoted the evidence at the end of the report from many sections of industry, the pharmaceutical industry and the Wellcome Foundation. I note that he skipped the submission from the Scotch Whisky Association; possibly that was the error of a Welshman skipping over Scotland's influence on this major report. He mentioned the Association of British Pharmaceutical Industries and others, which brought back to me, and I am sure to others, memories of six years ago to the day when we started our deliberations on the Patents Bill, which became the Patents Act 1977. Perhaps the noble Lord has gone off to sixth anniversary celebrations. I shall note the noble Lord's comments with care.
My noble friend Lord Campbell raised one or two very valuable points, apart from his Bill, which we shall be considering later. I was particularly grateful for his reference to the report before us as gold dust for our negotiators. I think he has put it aptly, and I am grateful for that little nugget this evening. I think it encapsulates the debate beautifully for our future deliberations.
I have gone on longer than I intended at this fairly late hour; I hope I have not rambled. I do stress that the Government strongly welcome this report, and in particular we appreciate its constructive approach to the proposals before us and assure your Lordships and the authors of the report that their analysis of the areas of difficulty will be of particular value to us in our continuing negotiations in Brussels.
Lord Mishcon: My Lords, before the noble Lord sits down, he referred to international exhaustion, and I wonder whether he is aware of the fact that there is also exhaustion in Members of your Lordships' House. Would he be good enough, if he sees fit, to pass on to his noble friends who arrange the business of the
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House that it is really regrettable that a matter of such national and international importance on the work of a committee which worked so hard should be taken so late at night?
Lord Lyell: My Lords, my noble friend has added "late but not light". I shall certainly pass on the concern of the noble Lord to my noble friend the Chief Whip. I understand that the usual channels were in conversation earlier with the noble and learned Lord who introduced the report.
10.40 p.m.
Lord Scarman: My Lords, having heard the recent exchanges between the noble Lord, Lord Mishcon, and the Minister, I do not know whether I now rise as the white rabbit looking at his watch or as the dormouse waking up from the tea party. Whichever it is, this has been a stimulating and constructive debate. Each noble Lord who has contributed to the discussion has brought to it something new, something original, something sensible and almost always something constructive. One cannot often say that of a debate, whether it is in good time or rather late. I also welcome the attitude of Her Majesty's Government to the report, and I am delighted to hear the use that they hope to make of it in their deliberations.
I end by saying, let us not reject the principle in the proposal for a Community trade mark. The principle must be sound in any great trading area. In the great markets of the United States of America, Canada and Australia where, of course, there are different systems of law within a federal structure, one finds that in each great area it has been necessary, or it was found necessary, to introduce a unified trade mark law. That is all that we are trying to do in the European Common Market area which is now a worthy rival of those great trading areas. We would be very unwise to do without it.
Therefore, at the end of this debate I say to the Government, let us adopt the attitude of the Comptroller-General of Patents, Designs and Trade Marks, and see what we can do to reconcile this principle with existing national systems which must continue. If I were a betting man I would say that, perhaps sooner rather than later, the Government will be reconsidering their attitude to reforming the national law of the United Kingdom in regard to the protection that it affords to service marks. If they do they will have a double welcome from myself, as I sit down, thanking the House for the attention it has paid to this report and this subject.
On Question, Motion agreed to.
The House adjourned at seventeen minutes before eleven o'clock.