Agricultural Holdings Bill [H.L.]

HL Deb 28 November 1983 vol 445 cc456-97

4.11 p.m.

House again in Committee on Amendment No. 31.

The Earl of Caithness

Perhaps this is an opportune moment to refocus on agriculture and to pick up one point made by the noble Lord, Lord John-Mackie. He referred to the number of tenancies as a result of his beloved 1976 Act. He produced a graph that a firm of land agents had given to him which showed that the trend of loss of agricultural land to tenancies was on a continual decline. There is a fallacy in his argument because if his 1976 Act was to be a success the graph should have gone up, not down. To take the graph to its logical conclusion, one reaches the stage where there are only two tenancies left in the country. If we then lose one, the noble Lord will say that that is marvellous because we have lost only one tenancy. In fact, we would have lost 50 per cent. The crucial point is that since 1976 the percentage loss of tenanted land in this country has increased dramatically over the previous years.

I recommend to the Committee the publication Contractual Relationships in Farming published in May this year by the RICS. It contains a complete set of tables giving the amount of agricultural land that is lost annually in the tenanted sector. In fact, on its figures the loss since 1950 has been at a lower rate every 10 years. Between 1950 and 1960 there was a loss of 52,000 tenancies; between 1960 and 1970 the loss was about 40,000 tenancies; and between 1970 and 1980 the loss was only about 32,000 tenancies. However, I come back to my point that the percentage loss increases every year and has increased even more dramatically since 1976.

Lord John-Mackie

I do not think that I should cross swords with the noble Earl on this subject of statistics. He is quoting from one publication and I am quoting from another. As I told him on Second Reading, my calculations were based on figures that I had. There would be no advantage in going further into the statistics. While I am on my feet, I should like to reply to the noble Lord, Lord Walston, and point out to him that this is not our Bill. It is a Government Bill and although we would like to continue with our 1976 Act, we know perfectly well that we have no hope of that. Therefore, we are trying to put forward the maximum that we think can be screwed out of the Government. That seems to be a sensible thing to do and it is ridiculous to start any polemics on what we said in 1976. We are trying to get the maximum that we can, and although I do not think we shall get it we shall still try. On that basis I beg to move that we divide on this amendment—if that is the correct phrase.

On Question, Whether the said amendment (No. 31) shall be agreed to?

Their Lordships divided: Contents, 55; Not-Contents, 144.

DIVISION NO. 1
CONTENTS
Ardwick, L.	Lovell-Davis, L.
Beswick, L.	Melchett, L.
Birk, B.	Molloy, L.
Bishopston, L.	Nicol, B.
Blyton, L.	Oram, L.
Brockway, L.	Paget of Northampton, L.
Brooks of Tremorfa, L.	Peart, L.
Bruce of Donington, L.	Phillips, B.
Carmichael of Kelvingrove, L.	Plant, L.
Collison, L.	Ponsonby of Shulbrede, L. [Teller.]
Darling of Hillsborough, L.
David, B. [Teller.]	Prys-Davies, L.
Davies of Penrhys, L.	Rea, L.
Dean of Beswick, L.	Ross of Marnock, L.
Elwyn-Jones, L.	Shinwell, L.
Ewart-Biggs, B.	Stallard, L.
Gaitskell, B.	Stewart of Alvechurch, B.
Gormley, L.	Stewart of Fulham, L.
Hale, L.	Stoddart of Swindon, L.
Hatch of Lusby, L.	Stone, L.
Hooson, L.	Strabolgi, L.
Jenkins of Putney, L.	Strauss, L.
John-Mackie, L.	Taylor of Mansfield, L.
Kearton, L.	Underhill, L.
Kilbracken, L.	Wallace of Coslany, L.
Leatherland, L.	Wedderburn of Charlton, L.
Listowel, E.	Wilson of Rievaulx, L.
Longford, E	Wootton of Abinger, B.

NOT-CONTENTS
Airedale, L.	Buccleuch and Queensberry, D.
Airey of Abingdon, B.
Alexander of Tunis, E.	Byers, L.
Allerton, L.	Caithness, E.
Alport, L.	Campbell of Alloway, L.
Amherst, E.	Campbell of Croy, L.
Ampthill, L.	Clinton, L.
Annan, L.	Coleraine, L.
Attlee, E.	Constantine of Stanmore, L.
Avon, E.	Cottesloe, L.
Aylestone, L.	Craigavon, V.
Balfour of Inchrye, L.	Cromartie, E.
Banks, L.	Cullen of Ashbourne, L.
Belhaven and Stenton, L.	Daventry, V.
Beloff, L.	Davidson, V.
Belstead, L.	De Freyne, L.
Bessborough, E.	Diamond, L.
Biddulph, L.	Digby, L.
Blake, L.	Donaldson of Kingsbridge, L.
Boyd-Carpenter, L.	Dormer, L.
Bruce-Gardyne, L.	Drumalbyn, L.

Ellenborough, L.	Mountgarret, V.
Elton, L.	Mowbray and Stourton, L.
Ezra, L.	Murton of Lindisfarne, L.
Forbes, L.	Northbourne, L.
Forester, L.	Northchurch, B.
Fraser of Kilmorack, L.	Nugent of Guildford, L.
Glanusk, L.	Onslow, E.
Glenarthur, L.	Orkney, E.
Glenkinglas, L.	Pender, L.
Gray of Contin, L.	Penrhyn, L.
Gridley, L.	Peyton of Yeovil, L.
Grimond, L.	Radnor, E.
Grimston of Westbury, L.	Rankeillour, L.
Hailsham of Saint Marylebone, L.	Reigate, L.
	Renton, L.
Hanworth, V.	Ridley, V.
Hayter, L.	Robson of Kiddington, B.
Hemphill, L.	Rochester, L.
Henley, L.	Rodney, L.
Hives, L.	Rugby, L.
Holderness, L.	Sainsbury, L.
Home of the Hirsel, L.	St. Davids, V.
Hornsby-Smith, B.	Salisbury, M.
Hunt, L.	Sandford, L.
Hylton-Foster, B.	Sandys, L.
Kemsley, V.	Savile, L.
Kennet, L.	Seear, B.
Kilmany, L.	Selkirk, E.
Kilmarnock, L.	Sempill, Ly.
Kinloss, Ly.	Skelmersdale, L. [Teller.]
Kinnaird, L.	Stanley of Alderley, L.
Kinnoull, E.	Stodart of Leaston, L.
Knutsford, V.	Strathcona and Mount Royal, L.
Lane-Fox, B.
Lauderdale, E.	Swinton, E. [Teller.]
Lloyd of Hampstead, L.	Teynham, L.
Lucas of Chilworth, L.	Trenchard, V.
Lyell, L.	Trumpington, B.
Mackie of Benshie, L.	Vaux of Harrowden, L.
Malmesbury, E.	Vickers, B.
Mancroft, L.	Vivian, L.
Margadale, L.	Waldegrave, E.
Marley, L.	Walston, L.
Masham of Ilton, B.	Westbury, L.
Massereene and Ferrard, V.	Whitelaw, V.
Merrivale, L.	Wigoder, L.
Middleton, L.	Wilson of Langside, L.
Mills, V.	Winterbottom, L.
Molson, L.	Wise, L.
Monk Bretton, L.	Wrenbury, L.
Monson, L.	Wynford, L.
Montgomery of Alamein, V.	Young, B.
Mottistone, L.

Resolved in the negative, and amendment disagreed to accordingly.

[Amendment No. 32 not moved.]

4.24 p.m.

The Chairman of Committees No. 33

I have to point out to the Committee that, if this amendment is agreed to, I cannot call Amendment No. 35.

The Earl of Radnor moved Amendment No. 33: Page 6, line 5, leave out from ("holding") to end of line 7.

The noble Earl said: In speaking to Amendment No. 33, I wish to declare again my interest as a landowner. The purpose of this amendment is perfectly straightforward. As far as I am concerned, its importance far outweighs the small number of words which the amendment would take away from the beginning of Clause 2. As your Lordships will realise, in terms of this debate—includingthe Second Reading—it perhaps rather dramatically re-establishes the status quo and re-establishes the position that there was in the farming industry so far as landlords and tenants were concerned before that particular part of the 1976 Act came into force.

We have been talking a great deal already about this Bill. One of the themes and remarks that comes up again and again is that the Bill will do nothing very much at all. I remember the noble Lord, Lord John-Mackie, saying that it was a mouse; and again and again people have said that it will not have the effect that at the same time everybody was saying they wished it would have; that it will not allow people outside the farming industry who have been trained, perhaps, in our agricultural colleges and who may bring in some fresh ideas to get into farming for so long that it is almost too much for us to contemplate. Most of us will certainly be dead when the three-generation succession has worked its way through and has allowed a few farms to get out into the tenanted sector.

It is important that we bear in mind that practically everybody acknowledged that that was a very important thing. That is one reason why I feel that a three-generation succession should not exist—not just for the tenancies created after the enactment of this Bill but also for those tenancies which existed before. There would. of course, be a relatively small number of farmers who have already succeeded since 1976, and that situation would not be disturbed by this amendment. They would still have their security for life.

Another very important point which bears talking about briefly once more, and which, again, noble Lords from all Benches have mentioned, is the extraordinary situation—and "extraordinary" is really the only word to describe it—of having two kinds of tenanted land and two kinds of tenant. I cannot really believe that the Committee wants legislation of that kind to go through. It will mean that we shall have one type of tenant who, because we have made a law in Parliament, is almost enfranchised or, shall we say, semi-enfranchised, while others who come a little later will not be in that position at all but will just have security for life. That seems totally wrong in parliamentary terms, apart from any other consideration such as social divisions. I believe that most of us are against situations which are divisive anyway, and this is something that I consider to be at least pretty divisive.

If one carries that argument a little further, one sees the ridiculous situation so far as the land is concerned. There could be two fields next door to each other that are absolutely the same: the same value so far as concerns growing crops, rearing stock and so on. There is a fence in between, and it is the boundary between a landlord who has a successional tenant and one who does not. Suddenly there is the anomaly that the land on one side is a fraction of the value of the land on the other. Also, I am quite aware that there is yet another factor—vacant possession land. It would be absolutely wrong to go on breaking up England in this false manner.

Those are the two main points that I want to make in supporting this amendment. I feel that they are very important. There are others, but I think they are peripheral. On reading the 1976 Act one finds that a number of people can succeed to the farm. I am not sure that I am too keen on the list, but, as I say, I think it is rather a peripheral matter. Broadly, there could be temptation for people succeeding to stay with the farm perhaps for understandable reasons of security. They might not be good at, trained in or interested enough in farming, although they could get the farm. The quality of farmers in England could gradually run down. I have almost a gut feeling that it is important to have outside blood, innovators and people with completely new ideas. I think I said in my Second Reading speech that that is absolutely vital to the well-being of the industry.

That is enough to start the debate going. I believe that if your Lordships feel that this Bill, as it stands, is not doing enough for the industry, we should redress the ill which was acknowledged at Second Reading. The ill was the passing of the 1976 Act. As I said on Second Reading, it seems absolutely logical to reverse the decisions made then. We might then see an improvement in the situation. I beg to move.

4.32 p.m.

Lord John-Mackie

Before I say anything about the content of what the noble Earl, Lord Radnor, said, may I correct him on his reading of the Second Reading debate? I thought that I was hard enough in calling the Bill a poor thing; it was the noble Lord, Lord Walston, who was rude enough to call it a mouse.

Nineteen seventy-six is not all that far back. Figures have been quoted for the number of tenancies since then. The noble Earl, Lord Radnor, is worried about having different tenancies on neighbouring land. He pointed out that the situation could be different on the other side of the fence. If all the tenancy agreements made since 1976 reverted back to life tenancies, it would greatly affect all those farmers who have made plans for themselves, their sons and so on. I do not think that the noble Earl would subscribe to the situation that it would create. If he did not want retrospective legislation, he should have voted for our amendment, which he has just voted against. It would have at least done something to bring the two situations closer together than they are now, with no succession and two successions. That is all that I have to say on the subject.

Lord Mackie of Benshie

For once I find myself in some agreement with my noble kinsman. I also have a certain sympathy for the arguments used by the noble Earl, Lord Radnor. It is true that there will be certain anomalies, but I think that what the industry needs is some stability. We at last have a Bill that has some chance of standing. Progress can be made from here, instead of the reversals that we have had since the war, with legislation being passed by one Government and reversed by the next. No industry can go ahead on that basis. I am afraid that the noble Earl's amendment is not a proper amendment at all; it is a completely wrecking amendment—although it is the job of the Government to say this. It destroys the whole purpose of the Bill. Although I have sympathy with some of his arguments, from these Benches we shall oppose the amendment.

The Marquess of Salisbury

I should like to support the amendment moved by the noble Earl. Like him, I must declare an interest, in that I have a number of tenanted farms in my family. I entirely agree with the view expressed by the noble Earl about the undesirability of creating two classes of tenancy for similar land. As I understand it, this matter is still part of the package between the CLA and the NFU with a view to creating more tenancies. I cannot see that the proposal will have very much effect on the situation. It does not matter very much whether a son succeeds a father or the farm is let to someone else, because it is some completely newcomer to the industry. The amount of extra land available is nil. The only way the proposal could help is if it encouraged landlords to let more land. For the reasons that I gave on Second Reading, I can see nothing in the Bill that will do that.

I find some support for that view in what the noble Lord, Lord John-Mackie, said in moving the previous amendment, when he said that, after all, a landlord has his land in perpetuity; why should not the tenant farmer have it for rather longer than just one life? If you carry that to its logical conclusion from the point of view of the landlord, he should get all the benefits and not let the land at all; and then this question does not arise.

I think that this has some bearing on this amendment as well as the previous one. I was also a little surprised at some of the arguments that the noble Lord, Lord John-Mackie, advanced for extending the terms of a tenancy for three lives. He mentioned tenant's improvements and buildings erected. I do not think that you need three life holds to justify erecting a building. As we all know, most are written off in 20 to 25 years at the most and often in a shorter period. The same goes for drainage. By the time that the third life had come into being, it would be time to redo the drainage altogether. I do not think either of those arguments justifies a longer tenancy. If you turn the argument the other way round, there is a lot to be said for shorter tenancies.

The other thing that we must bear in mind is that, if the proposal is a very insignificant change, what is the merit in it? We are sacrificing standardisation for some very limited advantage. I should like to ask a question. I do not know what the answer is, and I do not know whether the information I have been given is correct. If anyone has the answer, it would be helpful to know it. The other day I received a letter from a gentleman in Somerset. He claimed to have information about the views of the NFU with regard to the length of tenancies. He said that the NFU was telling its branches that it was never its intention to create more tenancies; the sole object in creating this package was to ensure security for three lives of its members. It was not interested in future intake. I do not know whether that is true. I rather suspect that it is not, but, if not, I hope that someone will be able to deny it. It casts something of a shadow on the suggestion that there is general agreement on the objectives of this Bill.

I should like to say a word about what the noble Lord, Lord John-Mackie, said at the end of his remarks about what, in effect, I think he feels is retrospective legislation. The noble Lord suggested that tenants, since 1976, will have made plans, and so on. I dislike retrospective legislation, just as I suspect most of your Lordships do. I therefore asked myself whether this was retrospective in the sense that one normally refers to that term. I concluded that it was probably not, although it could be argued that the dividing line between what is retrospective and what is not is very fine. It is, however, clear cut that someone, who has taken action to make money, which is perfectly legal, can find that taxation is placed on that operation in a subsequent Budget and Finance Bill, although it was untaxed perfectly legally at the time. That seems to be a general guide to what retrospective legislation is all about.

In this case, however, what we are really talking about is whether one section of a community is being penalised or suffering loss because of proposed legislation. It seems to me that if you applied that principle, we should have very little legislation at all. Almost always, someone suffers from proposals. I would suggest to your Lordships that the Rent Acts on residential accommodation would bean example. There is every reason for not adjusting rents even though it has cost the tenants more. It seems to me that this is a parallel. The suggestion that this is a case of retrospective legislation does not hold good. For these reasons, I support the noble Earl's amendment.

The Earl of Caithness

If this amendment is carried, I shall not be able to speak to my Amendment No. 35. It might therefore be for the convenience of the Committee if I mention a few points relating to it now. The basis of that amendment is very much in support of the amendment that we are discussing at the moment. However, mine is slightly more moderate in that all the tenancies created between 1976 and the passing of this Act should have security. My argument for saying this is that up to 1976 the tenancies, although they were annual agricultural tenancies, were effective for the life of that tenant. That is a contract that two parties entered into in good faith.

Suddenly, in 1976, we had retrospective legislation that threw a lot of estate and farm planning into total disarray. From 1976 to the passing of this Act, everyone knew there was succession. Any tenancies that were created were done in that knowledge. There should therefore continue to be succession for those tenancies created during that time. For future tenancies, I support the Bill in that there should be no succession because I am against the principle of it for tenancies. I believe that there are other ways of encouraging succession rather than by writing it into legislation.

However, having said that, I am concerned about one point that the noble Lord, Lord Mackie of Benshie, raised, and that is agricultural ping pong. A comment was made by the noble Lord, Lord John-Mackie, in col. 151 of Hansard on the first day of the Committee, which I interpret as meaning that what one can say and do in Opposition does not bind one to what one does in Government. I agree with that, but one should be responsible in Opposition. It was his noble friend Lord Melchett who raised the real scare of land nationalisation that is still a worry to many people. Some of us fear that, if and when the Labour Party comes to power, it will bring in land nationalisation.

From what the noble Lord, Lord John-Mackie, and the noble Lord, Lord Prys-Davies, said on the first day of the Committee and today, I rather fear that a Labour Government will bring in succession for tenancies regardless of what we do today. This is the real point that all landlords must bear in mind if they are going to create tenancies. There is a threat, from what has been said, that if and when a Labour Government get back to power they will bring in more retrospective legislation to make succession for all tenancies.

Lord Monson

I rise to support the amendment. I must declare an interest, both as a trustee and as a direct landlord, although the acreages involved are modest in each case. For the Government to accept the amendment would not mean that they were condoning the breaking of existing contractual agreements freely entered into, although, in passing, I must say that even if it did mean this, it would not be the first time that a Conservative Government condoned a breach of existing contractual agreements. The recent volte face over the moral acceptability of the 1967 leasehold reform legislation is a case in point.

I agree wholly with the noble Marquess, despite what the noble Lord, Lord Belstead, claims, that this amendment is not truly retrospective in effect, although, even if it were, it would not be the first time that the Conservatives have initiated or acquiesced in retrospective legislation. One might cite the Burmah Oil war damage compensation affair, or the Conservatives' decidedly lukewarm opposition to the blatantly retrospective 1975 Air Travel Reserve Fund Bill.

What the amendment, if agreed, would do is alter some individuals' financial expectations. There is nothing novel or radical about this. It is what most legislation does. Every annual Finance Bill alters people's financial expectations. Every measure of denationalisation does so. There must be many individuals who embarked upon a career with a nationalised industry in the expection that they would have a secure job for life, come what may, to be followed by an indexed-linked pension. Denationalisation may well dash those expectations. The Matrimonial and Family Proceedings Bill, which your Lordships read a second time the other day, alters the financial expectations of divorced husbands and divorced wives respectively. But, unlike the Matrimonial and Family Proceedings Bill, this amendment merely seeks to correct a temporary aberration and restore things to what they were, and indeed what they had been for a very long time prior to 1976.

The noble Lord, Lord Mackie of Benshie, spoke about the need for continuity. I agree with him. But we realise, do we not, following the Division that has taken place, that the Opposition have no intention of accepting Clause 2 as it stands if they return to power? They have made clear—at least that is my inference on re-reading the winding-up speech on Second Reading of the noble Lord, Lord Prys-Davies—that if returned to power they will alter Clause 2 of this Bill. Even if one forgets the moral arguments, which we should not do, the Government's attempt to placate the Opposition by compromising largely on the Opposition's terms will not work in the long term.

4.49 p.m.

The Earl of Onslow

I should like to support the amendment on some of the grounds raised by my noble friend Lord Salisbury. He doubted whether the NFU was actually interested in extra tenancies. It is palpably obvious that they are not interested in extra tenancies. The NFU, rightly, from its own point of view—I suspect that it is fairly narrow—is interested in protecting the rights and extending the privileges of its present members. That is what its members pay it for. It is for us in Parliament, when people behave like SOGAT—I am sorry, I mean the NFU—to say that perhaps they should not behave like that. It is for us to say that it is in the interests of the community as a whole that farming should be thrown open to a wider audience.

The noble Lord, Lord John-Mackie, made a speech on the last amendment which was the most perfect Tory squire speech of about 1880 that I have ever heard. My heart went out to him. I sympathise with every single thing he said. He was arguing passionately for the trees around his farm and for the inheritance of his children and his grandchildren, and he told us what his grandfather had said. We shall have him moving up in the peerage if he goes on like that any more. It was superbly good stuff. But he did not in any way even possibly allow for one extra bright young man to get into farming, and that, I think, is what we are trying to do. The Bill may or will go a little way towards that. It will be considerably improved if the 1976 tenancy arrangements are taken out, and if and when we come to short-term tenancies or fixed-term tenancies I hope that it will be improved very much indeed.

It is important that the life of the countryside should continue; it is important that the life of the countryside should be enriched by new blood; it is important that larger numbers of people should live in the big areas of Wiltshire, Suffolk and Norfolk. All of those things actually go against the interests of the NFU, but I suggest that they are in the interests of the country as a whole and that on this occasion we should not go along 100 per cent. with the views of the National Farmers' Union.

The Earl of Swinton

It has been suggested that the Bill as drafted does not go far enough and that Clause 2 should operate to restrict succession in the case of existing tenancies as well as tenancies entered into after the Act is passed. Though perhaps not entirely effective in terms of drafting, my noble friend's amendment seeks to do this and would seem to restrict succession by virtue of the retention of subsection (2) to tenancies where one succession has already taken place.

Though in agreement with the view that the 1976 Act was ill-conceived, I feel it would be equally wrong and damaging to abolish or limit succession to existing tenancies. This would be a radical and retrospective measure. I think it was my noble friend Lord Radnor who mentioned the question of two types of tenants being produced. I agree that this is probably not ideal but we do not live in an ideal world. In fact, the Government had to take a view between the two extremes of either leaving things as they were, and not repealing the 1976Act. and taking the line that has been pressed by several of my noble friends here today and making the whole thing retrospective. We reckoned that the lesser of the two evils was to go for a system which would end up with two types of tenants. In fact, it will in time cure itself. Many noble Lords have said in the course of these debates that agriculture is a very "long time" business. It certainly is; it will take a long time for this to work its way through and for there to be one general standard. However, that is a small price to pay.

We cannot in any case ignore the fact that many tenants, probably a very large number, may have made arrangements and may have entered into very substantial financial commitments based on the assumption that the present succession arrangements, based on two generations, will continue to apply. I am sure it would be wrong to try to go further than we are already proposing in correcting the excesses of the 1976 legislation by introducing provisions which would adversely affect such tenants and their successors.

We have been accused of placating the Opposition. I do not think that the Opposition appear very placated by the Bill, and I am certain that the one matter upon which they would agree with this side of the House is that we definitely have not been trying to placate the Opposition. It seems to me a strange and very peculiar argument that there is no point in passing any legislation which you think that the other side, when they get in, will repeal. If that were taken to its logical conclusion no Government, of any party, would produce any legislation at all. That might go down extremely well with the general public; there might be loud cries of. "Hear hear!"from the country. But I do not think that it would go down very well in this House because, after all, it would do us out of a job and this is a jolly comfortable place to come and work in as I am sure all of your Lordships appreciate. So, in my view, that is the most extraordinary argument that I have ever heard put forward.

However, I want to be serious about this matter. One of the greatest criticisms of the 1976 Act was that it was unfair to landlords in its retrospective effect. To legislate now to remove succession from existing tenancies would have equally damaging consequences. I hope we can agree in this Committee that two wrongs do not make a right. That, of all things, is upon what I would rest the Government's cause. It is not just to act retrospectively. My noble friend Lord Salisbury has tried to argue that this is, in fact, not retrospective legislation. I suggest to the Committee that it is retrospective. I have said it once and I will say it twice and even three times; two wrongs do not make a right and I hope, therefore, that my noble friend will not press the amendment.

Lord Monson

Is the noble Earl really saying that no privileges granted to pressure groups by a Labour Government, however unjustifiable those privileges may be, should ever be revoked by a Conservative Government?

The Earl of Swinton

The noble Lord gets me considerably confused. The first time he argued that it was no good doing anything because when the other side come in they will turn it hack again. If I understand him aright, he is now trying to say that there is some sort of deal so that we do not undo what they did. I do not think he can have it both ways.

Lord Prys-Davies

We very much agree with the Minister that this is a severe amendment. We believe that it is retrospective. Since 1976 many tenants have relied on the 1976 Act and they have acted on the strength of its provisions. Moreover, being induced by the expectation that an eligible member of his family will probably succeed to the tenancy, a tenant may have embarked in good faith on liabilities and altered his position by borrowing or by expenditure on his farm. Therefore, we submit that, since the 1976 Act has created in a tenant's mind the expectation that a member of his family would succeed to the tenancy on his death, technically Parliament should not allow that expectation to be defeated. If this amendment were carried it would allow that expectation to be defeated.

The Earl of Onslow

Before the noble Lord sits down I should like to raise a matter with him. He has said that it is certain that several people have entered agreements based on succession. Can he give us an example of just one such agreement that has been entered into, or is it just surmise on his part?

Lord Prys-Davies

What I said was that, induced by the expectation, it is probable or likely that the tenant will have embarked upon liabilities and expenditure and, indeed, will have continued to farm.

The Earl of Onslow

In other words, it is a guess on the noble Lord's part? He has no evidence of it.

Lord Prys-Davies

There have been so many hunches. When I asked Ministers for evidence that Section 18 has produced ill effects I was told that there was no firm evidence; there was no comprehensive assessment of the ill effects of the Act. I am sure that my noble friend Lord John-Mackie will be able to rely on his own experience in the farming community and produce evidence where tenants have incurred liabilities on the expectation that they would have the benefit of the Act.

The Earl of Caithness

Having listened very carefully to the noble Lord's speech, would he agree that the argument he used to support the tenant's case can be used, with exactly the same words, to support the landlord's case for tenancies pre-1976?

Lord Prys-Davies

The answer to that is, No. The 1976 Act was not meant to be an experimental Act; it was not meant to be a temporary Act: it was meant to be long-standing.

The Earl of Caithness

The point is that landlords entered into an agreement in the belief that the tenancy could be reconsidered at the end of that tenant's life. The arguments which the noble Lord put forward for maintaining the 1976 Act can be put forward in exactly the same way for maintaining the landlord's position pre-1976.

Viscount Mountgarret

Perhaps it would be helpful if I intervened at this juncture because my amendment, No. 36, might go some way towards meeting the point made by my noble friend Lord Swinton that two wrongs do not make a right. While in theory and in principle having great sympathy with my noble friends Lord Radnor and Lord Salisbury, who moved this amendment, it would seem that perhaps we are going too far completely to unscramble the terms of succession of the 1976 Act, for reasons which perhaps I ought to go into when my amendment is reached.

However, if my noble friends would read my amendment, No. 36, they might think it better possibly to withdraw this amendment and to see whether we cannot find a more middle-ground approach to the problem.

The Earl of Radnor

There has been a very considerable debate on this matter and I think that most of the questions which have been posed have been answered satisfactorily by Members in other parts of the Committee. Therefore, I shall be brief in my conclusion, but there are some matters which I must mention, at least to say who I agree with and who I do not.

First, I should like to touch on the matter of retrospection. I must admit that I agree with my noble friend Lord Salisbury. I think that the noble Lord, Lord Monson, outlined very well other pieces of legislation which have been in exactly the same position, with not too much comment being made. I do not believe that this is truly retrospective and it is certainly not what I would call retroactive. I hope noble Lords will forgive me if I forget who said what. Of course, one absolutely agrees with the wish to avoid "ping pong" legislation, but this Bill is a change. I think that the best way to deal with it is to go back to 1976 and then to sit tight. That is the best way to avoid further change. In none of my speeches have I mentioned a rather broad concept concerning ping pong, which is that I think the landlord is beginning to lose confidence in Parliament over legislation to do with land tenure. If he did not lose it in 1976 and this Bill goes through as it is drafted, I am sure he will now. That will be another nail in the coffin.

I should like to comment on the remark by the noble Lord, Lord Mackie of Benshie, that I had produced a wrecking amendment. The whole idea of tabling this amendment was not to wreck the Bill but to improve it, and I am quite sure that it would improve the Bill.

I think that I have said quite enough for one day. My noble friend Lord Swinton has said that two wrongs do not make a right. So far as I am concerned the 1976 Act was wrong and this Bill in this respect is wrong, and those are the two wrongs which I do not like very much. I should like to get the Bill straight from now on. This is a part of the Bill that does not allow for compromise. Last Tuesday, Clause 1 provided a great deal of fun for everyone and many experienced people made very lucid speeches. This is perfectly simple. It is no good my asking my noble friend to take the matter away, think about it and hash it about. So I shall have to divide the Committee to find out what your Lordships think.

5.5 p.m.

On Question, Whether the said amendment (No. 33) shall be agreed to?

Their Lordships divided: Contents, 18; Not-Contents, 171.

DIVISION NO. 2
CONTENTS
Brooks of Tremorfa, L.	Knutsford, V.
Caithness, E.	Monson, L.
Coleraine, L.	Northbourne, L.
Craigavon, V.	Onslow, E.
Cromartie, E.	Radnor, E. [Teller.]
Forbes, L.	Salisbury, M. [Teller.]
Forester, L.	Somers, L.
Kinloss, Ly.	Taylor of Mansfield, L.
Kinnaird, L.	Wrenbury, L.

NOT-CONTENTS
Airey of Abingdon, B.	Henley, L.
Allerton, L.	Hives, L.
Alport, L.	Holderness, L.
Ardwick, L.	Home of the Hirsel, L.
Attlee, E.	Hornsby-Smith, B.
Avon, E.	Houghton of Sowerby, L.
Aylestone, L.	Howie of Troon, L.
Balfour of Inchrye, L.	Hylton-Foster, B.
Belhaven and Stenton, L.	Jenkins of Putney, L.
Beloff, L.	John-Mackie, L.
Belstead, L.	Kaberry of Adel, L.
Bessborough, E.	Kemsley, V.
Biddulph, L.	Kilbracken, L.
Birk, B.	Killearn, L.
Bishopston, L.	Kilmany, L.
Blake, L.	Kilmarnock, L.
Boston of Faversham, L.	Kimberley, E.
Boyd-Carpenter, L.	Kinnoull, E.
Broadbridge, L.	Lane-Fox, B.
Brockway, L.	Lauderdale, E.
Bruce of Donington, L.	Lawrence, L.
Bruce-Gardyne, L.	Leatherland, L.
Buccleuch and Queensberry, D.	Lloyd of Hampstead, L.
	Longford, E.
Byers, L.	Lucas of Chilworth, L.
Campbell of Alloway, L.	Lyell, L.
Campbell of Croy, L.	Mackie of Benshie, L.
Carmichael of Kelvingrove, L.	MacLehose of Beoch, L.
Clinton, L.	MacLeod of Fuinary, L.
Collison, L.	Malmesbury, E.
Colwyn, L.	Mancroft, L.
Constantine of Stanmore, L.	Margadale, L.
Cottesloe, L.	Marley, L.
Cox, B.	Massereene and Ferrard, V
Cullen of Ashbourne, L.	Maude of Stratford-upon- Avon, L.
Darling of Hillsborough, L.
David, B.	Mayhew, L.
Davidson, V.	Merrivale, L.
Dean of Beswick, L.	Middleton, L.
Denham, L. [Teller.]	Molloy, L.
Diamond, L.	Molson, L.
Digby, L.	Monk Bretton, L.
Donaldson of Kingsbridge, L.	Mottistone, L.
Drumalbyn, L.	Mowbray and Stourton, L.
Eccles, V.	Murton of Lindisfarne, L.
Ellenborough, L.	Nicol, B.
Elton, L.	Northchurch, B.
Elwyn-Jones, L.	Nugent of Guildford, L.
Ewart-Biggs, B.	Ogmore, L.
Fanshawe of Richmond, L.	Oram, L.
Fitt, L.	Orkney, E.
Fortescue, E.	Peart, L.
Fraser of Kilmorack, L.	Pender, L.
Gainford, L.	Penrhyn, L,
Glanusk, L.	Peyton of Yeovil, L.
Glenkinglas, L.	Phillips, B.
Granville of Eye, L.	Pitt of Hampstead, L.
Gray of Contin, L.	Ponsonby of Shulbrede, L.
Grimond, L.	Porritt, L.
Grimston of Westbury, L.	Prys-Davies, L.
Hailsham of Saint Marylebone, L.	Rankeillour, L.
	Reigate, L.
Hale, L.	Renton, L.
Hatch of Lusby, L.	Ridley, V.
Hemphill, L.	Robson of Kiddington, B.

Rochester, L.	Strauss, L.
Rodney, L.	Swinton, E. [Teller.]
Ross of Marnock, L.	Terrington, L.
St. Davids, V.	Teynham, L.
Sandford, L.	Thorneycroft, L.
Sandys, L.	Tranmire, L.
Savile, L.	Trumpington, B.
Seear, B.	Underhill, L.
Selkirk, E.	Vaux of Harrowden, L.
Sempill, Ly.	Vickers, B.
Shinwell, L.	Vivian, L.
Skelmersdale, L.	Waldegrave, E.
Spens, L.	Wallace of Coslany, L.
Stallard, L.	Walston, L.
Stanley of Alderley, L.	Wedderburn of Charlton, L
Stewart of Alvechurch, B.	Westbury, L.
Stewart of Fulham, L.	Whitelaw, V.
Stodart of Leaston, L.	Wigoder, L.
Stoddart of Swindon, L.	Wilson of Langside, L.
Stone, L.	Wise, L.
Strabolgi, L.	Wootton of Abinger, B.
Strathcona and Mount Royal, L.	Wynford, L.

Resolved in the negative, and amendment disagreed to accordingly.

[Amendment No. 34 not moved.]

5.18 p.m.

The Earl of Caithness moved Amendment No. 35: Page 6, line 6, after ("granted") insert ("before the coming into force of that section of the 1976 Act or")

The noble Earl said: I have spoken to this amendment. It is similar to Amendment No. 33 but a great deal more moderate, and in that case I hope it will commend itself to the Committee. I beg to move.

Lord Walston

Again I have sympathy with the noble Earl in this amendment. On the face of it, it has a considerable amount of justice; and on the face of it, it does not have the disadvantage which the previous amendment had of retrospective legislation. Thinking about it in more detail and somewhat more deeply, I am afraid I must oppose it, and we on these Benches will oppose it, on two grounds.

First, although it is not retrospective in the sense that the previous amendment was, there is no doubt at all that farming families, as a result of the security which the 1976 Act gave to them, have taken certain steps and have made certain provisions which they could not have done had they had security for only one life. Let us take the somewhat hypothetical example, based on fact, of a father in his forties or fifties, perhaps, when the 1976 Act came in. His son was in some other occupation, as frequently happens, but because of the security which was offered, not only to the son but to the grandson also, he decided to give up that occupation to farm with his father. As a result of the amendment being accepted, at the age of 40 or 45, having been farming perhaps for 15 years, he will now find that he no longer has the security which he was led to expect would be his, and his whole way of life has been altered.

That is not an isolated case. Your Lordships can all think of similar cases which have arisen or which would arise if the amendment were accepted. On those grounds of an element of retrospection and injustice, I believe that the amendment should be opposed.

My second ground is that we do not want to over complicate the Bill. We have already had a whole series of amendments, some of which may be accepted, and I hope some modifications will be incorporated as a result of others which have been discussed. This is a relatively minor matter not affecting a large number of people, but will add a further complication and give rise to further discussion. I should like to avoid that, and I suspect the noble Lord, Lord Belstead, would also like to avoid it.

We must remember why we do not want to be dictated to either by the CLA or by the NFU. The Bill is a result of a delicate balance and discussions between them. While I am quite prepared on a matter of serious importance to upset that balance and come down more on one side than the other, in a matter of this sort, which is of only minor significance, it would be unfortunate if the balance were disturbed. I advise noble Lords to reject the amendment.

Lord Belstead

I should like to recognise that my noble friend Lord Caithness has thought seriously about trying to make alterations to the Government's policy on the repeal of the 1976 Act, and in this amendment is endeavouring to do so moderately and reasonably. Indeed, the amendment has, on the face of it, the merit of impeccable logic. But in this country we are not all that strong on logic and tend to prefer the pragmatic approach, or, in plain English, to ask the question: will it work?

I do not think that this amendment would work very well. For a start, it does not deal with the problem of those pre-1976 tenancies which may already have passed to the second generation. Thus a chain of succession has already begun; and on that question the amendment is silent. My noble friend does not give sufficient weight to the point made by the noble Lord, Lord Walston—namely, the distress which could be caused to tenants who have already laid plans and made investments for the future, on the assurance that the 1976 Act would not be repealed retrospectively. Although I well understand the motives of my noble friend, I am afraid I cannot accept the amendment.

The Earl of Caithness

I am grateful for the reply from my noble friend. I have no wish to press the amendment. In cases where succession has already taken place, my amendment would have no effect because that would be the current tenant and that would be the end of the matter. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Viscount Mountgarret moved Amendment No. 36A:

Page 6, line 8, leave out subsection (2) and insert— ("(2)(a) The right of succession as provided by section 18(1) of that Act will only apply for one succession beyond the present tenancy provided the existing tenant exercises his right (if any) to pass the tenancy on to his heir prior to attaining the age of 65. (b)Succession shall apply automatically if the existing tenant dies before attaining the age of 65, provided the successor is qualified under the provisions of the 1976 Act. (c)Where a first succession tenancy has been established before the passing of this Act, the provisions of paragraphs (a) and (b) of this subsection shall not apply.")

The noble Viscount said: Your Lordships' Committee has recently demonstrated that they feel very strongly indeed about the idea of returning to the status quo prior to the passing of the 1976 Act. I hope, therefore, that the suggestion that I have made in this amendment, which seeks to mitigate the retrospective and rather more painful aspects of the 1976 Act, might perhaps find some sympathy with the Government.

This section of the 1976 Act was primarily concerned to ensure that the existing tenanted land available at that time would remain available to tenants for a considerable length of time ahead. It did very little, if anything, to encourage further availability of land for letting; in fact, it did just the reverse. My amendment provides that there should be only one right of succession beyond the present tenancy, rather than two as at present. The present tenant should retain his right to be a tenant for life, but his right, if any, to pass the tenancy on to his heir should be valid only if exercised before reaching the age of 65. That may be a useful clause because it gives the landlord and the tenant family some idea of the future and what the plans and proposals arc. If the tenant dies before the age of 65, succession should be allowed automatically, provided that the heir or successor is qualified under the present arrangements.

Furthermore, in paragraph (c), if there has already been a succession since the 1976 Act, these provisions should not apply. The reason I suggest that is because in 1976 existing tenants had a terrific bonus issue. They did not know what would be handed out to them. They could not expect then that automatically their family, heirs and successors would remain on the farm for a long time ahead. If we could limit that length of time out of fairness and equity to the tenants, that would go some way towards easing the great inconvenience presently found by many landlords. Where existing tenants have understandably laid plans for the future for their immediate successors, I do not think it is likely that they will have gone as far as to make plans and provisions for the second generation. Therefore, any possible change of plan at this stage should not be greatly inconvenient to the second generation successors.

As a final point on this amendment, it says in the first half of the amendment … leave out subsection (2)…"; in other words, in its entirety. I should like to say that subsequent to tabling this amendment, I am given to understand that it is probably undesirable to take out the existing paragraphs (c) and (d) of the subsection because (c) might well be a necessary protection for the parties in ensuring proper management of the land; and that there should be an ability to contract in; and paragraph (d) provides some protection for the tenant against the landlord possibly seeking to adopt avoidance measures. I understand that. I would not want to go very much further on that particular point and therefore I shall be withdrawing the amendment. But I should be grateful and interested to know what my noble friends on the Front Bench might feel able to do and what the Committee might feel about trying to get some of the provisions of the second half of the amendment written into the Bill. I beg to move.

Lord Mackie of Benshie

I should like to say that although this amendment has a great deal to commend it, the objection is the same as to the previous amendment which has been voted on, that it cuts across the whole sense of the Bill. It alters one of the main clauses and therefore destroys any degree of agreement which was reached. It is a little illogical in some things but it is not a bad amendment, really. However, it has the great fault that it wrecks one of the main purposes of the Bill.

Lord Belstead

I repeat, if I may, what I said on the last amendment; namely, that I genuinely understand the reasons why in this case my noble friend Lord Mountgarret has moved this amendment. I think it is not unreasonable for those of us on this side of the Committee to recall that when the noble Lord, Lord Northfield, produced his very substantial report, in paragraph 626 the noble Lord and his committee rather drily remarked of the 1976 Act: If the legislation were not already in existence it is unlikely that we should be recommending identical provisions as being right for agriculture". You can say that again! It really was the most disastrous thing to do, to put as a sort of afterthought in another place three generations of succession which would go on for over 100 years and to ask those who own land simply to sign away their birthright when what they would be wishing to do would be as landowners have done over the centuries: voluntarily to have the sort of agreement between landlords and tenants which has been such a bastion of British agriculture. It really was disastrous. I understand absolutely why my noble friends Lord Mountgarret and Lord Caithness put down these amendments.

Having said that, there are difficulties. One of them is that, in a strange way the first bit of my noble friend's amendment does the same thing as noble Lords opposite were trying to do in Amendment No. 31. I am sure that my noble friend Lord Mountgarret would not dream of doing anything that noble Lords on the Benches opposite would do; namely, to restrict succession to only one generation of succession. I think that the noble Lord, Lord Mackie of Benshie, has justification in saying that in cutting across the intentions of the clause, we then run into other troubles. I think that it is questionable, if I may say so, whether one should say in the final subsection of his amendment that because a successor happens to have succeeded since 1976 then that is it and nobody else should succeed at all. I think that that is pretty draconian.

Thirdly—and here I say it very much more helpfully—I think that the middle part of my noble friend's amendment about retirement age is a very interesting suggestion which we are going to come on to again (although the age of 65 is not specifically mentioned) in the very next amendment by my noble friend Lord Kinnoull. It is a matter we shall come on to yet again on amendments which have been taken down from different parts of the Committee. In saying to my noble friend that I well understand the motives for this amendment, I am sorry but it is difficult for the Government to be able to go further than to express understanding and sympathy. To accept the amendment will bring us back into retrospection, and we are determined—I believe, rightly—not to do that.

Viscount Mountgarret

I am grateful for what my noble friend has said. I am not sure that I go along entirely with everything that he has said. I wondered why I was in some difficulty in finding myself in total agreement with the noble Lord, Lord John-Mackie. My noble friend Lord Caithness said, I think, that that was all right. I will look to see what precisely has been said. In the meantime, I will withdraw the amendment as it stands. I should like to think more about it and may come back to some part of the amendment on Report stage. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

5.38 p.m.

The Earl of Kinnoull moved Amendment No. 37:

Page 6, line 24, at end insert— ("( ) Without prejudice to subsections (1) and (2) above, the said section 18(1) shall extend and apply in any case where the sole (or sole surviving) tenant of an agricultural holding gives twelve-months' written notice to the landlord and the tenant desires to retire as tenant, as section 18(1) would apply were the tenant to die on the date of expiration of the notice; and the subsequent provisions of Part II of the 1976 Act shall (except as mentioned in section 18(1)) apply accordingly with necessary modifications.").

The noble Earl said: I beg to move this amendment standing in my name. This is the second amendment to try to improve the complicated succession provisions of the 1976 Act. It infringes upon the eligibility test of succession for existing tenants which, of course, are not being taken out of their rights under this Bill. The provision of succession rights of the tenants under the 1976 Act are by no means perfect. Perhaps I may quote a leading Queen's counsel who said that the provisions as they are drafted at present fail to shut out the claims of many applicants who are extremely well provided for and cannot by any stretch of the imagination be said to require the benefit of the Act of 1976; and, conversely, some applicants who are in genuine need of rights of succession find themselves undeservedly disqualified. I think that is a very balanced view by a leading QC.

The amendment seeks to improve in one aspect the eligibility test, the aspect of retirement. It is a very strange situation that in every other walk of life it is quite normal to find that people retire at 60, 65 or 70, but not so in farming. Why not in farming? The noble Lord, Lord Northfield, and his committee suggested, I think in paragraph 467, under the sub-heading "Fewer exits" that it was just "a way of life". Is farming today just a way of life? Does it not require high risk capital? Does it not require enormously hard physical work and does it not require both skill and judgment in a continually changing world of technology, where noble Lords who may have been trained even 10 years ago are now out of date in some technology?

There is no excuse in my view for encouraging and for continuing to encourage generations of geriatric farmers. I am not pointing a finger at anyone in this Committee in saying that. Perhaps on a more serious note, there is no excuse for blocking the farmers' ladder, as my noble friend Lord Stodart said at Second Reading. The present position of the 1976Act does not allow any real flexibility for the tenant to retire. He has two options. Either he can retire by agreement with the landlord or he has to die. That is a very narrow option, and how damaging to the industry! This amendment will allow the tenant to give notice to the landlord that he wishes to retire without endangering his succession rights. My noble friend has not given much away so far during the two days of our Committee and I hope that he will perhaps "break his duck" on this amendment. I beg to move.

Lord Northfield

I wonder whether we might ask the noble Lord, Lord Belstead, to be helpful to the Committee at this point. Would he agree that we might have a general debate at this stage about the whole issue of retirement at 65 which arises on my Amendment No. 45A and also on the amendment of my noble friend Lord John-Mackie, No. 59? If he says he would prefer us to deal with this retirement issue in one debate, it would be helpful to know.

Lord Belstead

If the noble Lords, Lord Northfield and Lord John-Mackie, have no objection, I would have thought that would be for the convenience of the Committee, but I am in the hands of your Lordships.

Lord John-Mackie

We would very much agree with that because our amendment is very much like that of the noble Earl, Lord Kinnoull, and I am sure it would save a lot of time if they were discussed together.

Lord Stanley of Alderley

May I make just one point: there are two sorts of retirement. One is the retirement concerning those who are protected under the 1976 Act, and then there is the question of retirement for those who are not covered but who will be covered by future tenancies. As I understand it, my noble friend's amendment is really dealing with those who are protected under the 1976 Act. I just wonder whether I ought perhaps to make a remark on that specifically at the moment.

Lord Renton

Could we be told exactly which amendments are therefore to be discussed together?

Lord Northfield

It is suggested that No. 45A, which is called "transfer earlier than death", and also No. 59, which is also called "transfer earlier than death", are both on the same point as that raised in the amendment of the noble Earl, Lord Kinnoull. May I say I do hope that we can discuss them together so that we can get some response from the Minister as to how he sees the whole issue of retirement, as opposed to waiting for death and succession.

I do not necessarily want to read from my Committee's report, but I would point out that first of all we did say that we objected to compulsory retirement because that can cause a good deal of hardship in particular cases, except in the case of small holdings; and we can deal with that matter in connection with another amendment. But in the case of voluntary retirement my committee recommended that there should be encouragement to transfer earlier than death, and we said: We are agreed that this could be achieved by providing that the tenant might, at or after the age of 65, with his nominated successor, apply for transfer of the tenancy. The landlord could contest the application both to oppose the succession and to put his own case for possession". This is what I have tried to deal with in my Amendment No. 45A. That says in effect that the provisions of this Act—namely, Clause 2 and the new kinds of tenancies—as well as of the 1976 Act, shall apply where tenants, joint tenants and so on reach the age of 65 and application is made to the tribunal for the transfer of the tenancy at that age without waiting for the death of the person concerned. It ends by saying: such transfer, if agreed to by the Tribunal, shall constitute statutory succession within the meaning of these Acts". In other words, I have tried to combine most of the views about retirement; but there is one particular point I have to emphasise. My amendment suggests that it is also the landlord who can apply to the Tribunal to force the pace of succession at age 65 of the tenant or tenants. I do that because evidence that we took indicated that there were cases where a tenant was, if one might say so, "hanging on" unduly and was probably best succeeded, in terms of what would be good for the farm and the land generally; the tenant ought really to be succeeded, in view of his age, by his successor. Therefore, I have put in my amendment the right of the landlord to go to the tribunal to "force the pace" as well as the eligible persons who would otherwise succeed.

I believe this whole issue is very important indeed because if we are going now, as we do in this amendment, to proceed beyond the strict agreement of the NFU and the landlords to broaden this Bill in ways which would make more tenancies available, then this is one of the first steps that we should be taking. It is the case that people do hang on because there is no statutory right of succession until death occurs and, in my view, it would be sensible to pick an age and let the tribunal adjudicate finally as to who was being reasonable about the whole affair—whether the landlord was being reasonable, the tenant, the successor or whoever. That is why my amendment is deliberately put down as a new clause to allow the tribunal to look at the whole situation as it stands and suggest the correct way to proceed.

If I may say so, one of the problems, I think, with some of the other amendments is that the desire to retire, or being ill, or whatever, is considered. I do not think that comes into it at all. It should simply be the case that at 65 someone should have the right—in my amendment I suggest it is the tribunal, because the tribunal makes all the other decisions in regard to the 1976 Act—to say, "Look, we think it is in the general interest of the holding, the landlord, the farmer and the eligible person to succeed". On balance, it is, or it is not, right that this tenancy should be transferred at age 65 without waiting for the death of the tenant. That is why I have put down the amendment in this form. I hope that this has opened a debate on the whole issue, and I present it in that spirit.

Lord Stanley of Alderley

I agree entirely with the noble Lord, Lord Northfield, that this is a most important subject to which we should address ourselves this afternoon. What I do not agree with him on, needless to say, is how we should do it. It is absolutely vitally important that your Lordships should get quite clear in your minds the position of someone under the 1976 Act. It is totally different from the position of someone who will come in after this Bill is passed. I should like those two issues to be dealt with separately; otherwise we shall get ourselves in a muddle and, what is very much more important, if we send the Minister away to think about it and the industry also has to think about it, they will get into a muddle over it. I think that totally different provisions should be made for the two.

If I may, I will say something very quickly about my noble friend's amendment, My noble friend Lord Kinnoull said that it is normal to retire. That is so, but I would point out straight away that if you bring in compulsory retirement for farmers, they will be the only self-employed people who will have compulsory retirement. I am not immediately ruling that out, but I am just saying that I think my noble friend is slightly at a miss there.

I am in agreement in principle with my noble friend's amendment for some form of retirement, certainly so far as the 1976 Act tenants are concerned. I believe his amendment will have technical problems attached to it. I am told you will have to write the 1976 Act again more or less completely; but that is merely a technicality which I am sure can be done. I hope therefore that my noble friend will be patient here and I also hope that the Government will be patient while they listen to the debates that I am sure we are going to have on the amendment of the noble Lord, Lord Northfield, to try to get a consensus here.

Again, as regards my noble friend's amendment, I would hope that some definite age might be put into the wording because, although it may sound nice to have any old age, if your Lordships think about it carefully it could cause considerable family problems. For instance, you might get, "Let's kick the old chap out at 45". That is what they might say, and I think that would be wrong. But let me hasten to add to my noble friend Lord Kinnoull that I have great sympathy with his amendment. I hope that at some time the Government will be able to think about it, together with the other discussions that we shall have later on.

Lord Walston

I certainly support the principle behind the amendment of the noble Earl, Lord Kinnoull. I think that it is sound and I speak as a geriatric farmer myself who has, to all intents and purposes, retired from farming. It is very important that it shoud be easy for farmers, when they reach a certain age—and what that certain age should be is very difficult to arrive at—if they have security of tenure for their sons, to pass it on rather than have to wait till their death. It is absolutely essential that that should be done and it would enormously strengthen any legislation such as that which we are now talking about.

I am not so happy about the proposals of the noble Lord, Lord Northfield, and they require a great deal of thought. I know of several cases where the old man hangs on and says, "There is nothing I should like better than to give up, but I have to wait a few more years, because the boy is not quite up to it yet, and he is having problems with his wife and children", or whatever it may be. "I shall do it in another few years". But of course that time never comes and he stays on and on, because he likes wandering around the fields saying "Don't use those sprays. We did not do it that way", and so on.

Unless he is going willingly, you will have all sorts of frictions and unhappinesses not only between the landlord and the tenant, but between the tenant and the heir. After all, one must remember that in most cases the old man owns the tenant capital—the tractors, the combines, the cows, and so on—which amounts to quite a lot of money. Unless he is prepared willingly to hand those on to his successor—his son—you will not have a very satisfactory situation. The tribunal may say, "The old man is too old and doddery. He is no good and the son should take over", and the landlord may be content with that. The old man does not quite say, "Not over my dead body", but says "If he is going to take over, I shall not give him all the tenant capital. He will have to buy it". The son will not have the capital with which to buy it, and if he borrows he will be overburdened with debts and will not make a success of the farm. Those are some of the practical difficulties which come to my mind.

I am not saying that I am against the proposal of the noble Lord, Lord Northfield. I should like to see it work, if it can be worked out in such a way that it is practicable and does not cause more troubles than it seeks to avoid. But as regards the amendment of the noble Earl, Lord Kinnoull, that seems to be an admirable one and one which deserves our support.

Lord Prys-Davies

We on these Benches cannot bring ourselves to advocate compulsory retirement, but we see considerable merit in our Amendment No. 59, in the amendment of the noble Lord, Lord Northfield, and in the amendment which is before the Committee. We reject the principle of compulsory retirement, because that would cause hardship. If we were to single out for retirement a farmer who is conducting his own business, that would be the only example of a self-employed person being compelled to retire.

Nevertheless, the principle of voluntary retirement and redundancy has been an important feature of social policy throughout our century. It will continue to occur and our amendment, and the amendment of the noble Earl, are an encouragement to voluntary retirement. As has been said, under the 1976 Act, unless there is an agreement between the landlord and the tenant, the succession provisions apply only on the death of the contractual tenant. The result is that tenants hold on to their tenancies, sometimes into advanced age, at the expense of the standards of husbandry. When a farmer who is conducting his own business ought to retire is dependent upon all the circumstances, and they vary considerably. That is why we find difficulty in going along with this magic age of 65. His retirement must depend on the state of his health, on his wishes and on his finances. But when the time comes and he wishes to retire, if the landlord is unwilling to agree an assignment of the tenancy to an eligible successor during his lifetime, then it appears to us that the tenant ought to be able to go to the ALT and apply for the transfer of the tenancy to his nominated successor. So there is a great deal of common ground expressed by these three amendments, and I hope that the Minister can respond constructively to the underlying principles.

Earl Waldegrave

I am sure that the Minister will respond constructively, as he has done all the way through the Committee stage, but I hope that he will keep one point very clear in his mind when he replies. I refer to the point which my noble friend Lord Stanley of Alderley made, that one has to think very differently about these two classes of tenant—the man who has the three-generation tenancy and the new tenant who will have the one-generation tenancy. This will be the most difficult point and that is why, if we are to vote, it may be necessary to vote separately on these amendments.

5.58 p.m.

Lord Belstead

If I may pick up the point made by my noble friend Lord Waldegrave at the very end of his remarks, may I express the hope that we will not find ourselves voting on these amendments, because I agree with the noble Lord, Lord Prys-Davies, that there is a good deal of common ground and I should like to make it crystal clear to the Committee that the Government very much welcome each of these amendments as being a step towards an objective which seems to be shared on all sides. If we can provide in this Bill in your Lordships' House for a really fair provision for voluntary retirements, and thereby increase the frequency with which tenancies come forward, then we shall have done a good job.

If I may take, first, the amendment of my noble friend Lord Kinnoull, this is a very attractive concept. But my noble friend will forgive me if I suggest that the drafting appears to be a little compressed towards the end of the amendment, and I think that the draftsman would need to have a look to see how we should talk about "necessary modifications", without just referring to them by those rather sweeping and dismissive words. But that is a drafting matter.

It is interesting that my noble friend does not mention an age in his amendment. That is a matter which has already been picked up in this brief debate and I am not sure whether my noble friend omitted that deliberately. Certainly, an age is being discussed by those who are interested in this matter and, again, thought would have to be given to decide whether 65—if an age was written into any amendment—was the right age and whether that would be suitable if one were talking about the retirement age of women. Here I am afraid that I have to look at the Committee and say that I think it is a matter to which we need to give a little thought.

I assume from my noble friend's amendment that the application would be decided in the final analysis by the agricultural land tribunal, though my noble friend's amendment does not say so in terms. Assuming that that is the way it will be decided, as my noble friend will know, in some other amendments there is provision that, having made such an application, you cannot go on making the application again. This is a protection for the landlord. Would not my noble friend wish some such provision to be put into the amendment?

Turning to the amendment in the name of the noble Lord, Lord Northfield, again I listened with very great interest to what he had to say, and as I did so it occurred to me that what he is seeking to do in Amendment No. 45A is covered in part by existing legislation and in part by Clause 2(2)(c) of the Bill. Under Section 18(5) of the 1976 Act, the tenant can seek the agreement of his landlord to retire and to be succeeded by an eligible successor. The section also ensures that such successions can count for the purposes of the two succession rule. This is further reinforced by Clause 2(2)(c) of the Bill, which provides that agreements in writing entered into in this way can count for succession purposes. To that extent, the noble Lord's proposal would run concurrently with what has been proposed and is being proposed in legislation. A further point is that under Section 18(5) the tenant may seek the agreement of his landlord at any time. He does not have to wait until the age of 65, although I recognise what the noble Lord, Lord Northfield, said in speaking to his amendment: that the landlord can take the initiative. Again, the Committee would wish to give a certain amount of thought to whether or not that was desirable.

Before leaving the noble Lord's amendment, may I say that I recognise that this matter was raised by the noble Lord's own committee and that we are indebted to his committee for the genesis of the ideas which are coming forward now in these important amendments. That is not mere politeness: if we can do something here, we shall most certainly have taken a step in the right direction.

Finally, may I deal with the amendment moved by the Front Bench opposite. Aspects of the amendment will obviously appeal to the Committee. It is made very clear in the wording that this is to be permissive, not mandatory. It is to be the wish of the tenant to retire on account of ill health and to be desirous of assigning the tenancy. It enables the eligible person to apply, with the written consent of the tenant, to the tribunal. It is most certainly permissive. Having said that, it chooses 60 rather than 65, gives ill health as the ground for retirement and (what is somewhat controversial) provides that only the eligible successor, rather than the tenant and the eligible successor together, need apply. To go quite so far as is proposed in the amendment in those particular respects would perhaps tip the balance rather too far in the tenant's favour, but we ought to look very carefully at Amendment No. 59 as well.

I realise that by taking these amendments together I have not satisfactorily answered my noble friend Lord Stanley of Alderley, and that I must look at his point. Both he and my noble friend Lord Waldegrave said that they feel that the tenancies formed under the Bill compared to tenancies formed before the Bill came into effect might need to be looked at differently. I must confess to both my noble friends that this expression of view has taken me aback. I say quite openly that I am not briefed on this point, and that I do not know quite how to answer. Therefore, I shall say what I intended to say: that if your Lordships feel that this is a sensible way to proceed, I would ask that these amendments should not be pressed.

I suggest that we should proceed in this way. I give an undertaking that the consultations on this point which have been taking place should now be brought to an end, that the Government should very seriously consider what has been said in your Lordships' Committee on this point and that we should use our best endeavours, if we possibly can, to bring forward an amendment which would receive all-party support at the Report stage. We shall certainly attempt to do this. As I have said before, I cannot promise that we shall be successful, but I have a feeling that the problems in this area should be easier to overcome than some of the other problems we have in the Bill.

Lord John-Mackie

I must thank the noble Lord for being what is called conciliatory at the Committee stage. The noble Lord, Lord Walston, said that to all intents and purposes he is retired. I must say emphatically that to all intents and purposes I am not retired. My only point relates to the question of age. The noble Lord, Lord Belstead, must have our original amendment in front of him, not the new starred Amendment No. 59, which does not have in it the age of 65 and illness. We gave the matter further thought and took out the age of 65 and illness. The amendment deals just with the tenant who wishes to retire.

I have been a member of various bodies all my life, including in particular the Forestry Commission. It has always worried me when I have seen young, able men of 60 having to retire. If one looks at the Civil Service as a whole, one sees that civil servants have to retire at the age of 60. To insert an age would spoil everything. When the Government look at the matter and come back with suggestions, I appeal to them not to put in an age qualification. Some people are becoming geriatric at the age of 50, while others do not approach the geriatric stage until they are nearly 80; so I appeal to the Government to leave out the age question.

Lord Stanley of Alderley

Before the noble Lord sits down, may I ask him whether he said that he wants an age in, or whether he does not?

Lord John-Mackie

I do not want an age in.

Lord Belstead

The noble Lord, Lord John-Mackie, is the best possible advertisement for not wanting an age in. May I offer my apologies to the noble Lord for using a line or two of a speaking note which referred to a previous form of the amendment. It is indeed a fact that ill health is not mentioned, which makes the amendment in the name of the noble Lord and his noble friend that much more attractive.

The Earl of Caithness

While we are discussing the problem of retirement, may I refer to a point which I made in my Second Reading speech; namely, the tenant who wants to retire but who has no successors and the landlord who agrees that the tenant can retire and who wants to relet the holding? A problem arises where the tenant cannot afford to retire. At Second Reading I raised the point that the tenant should be allowed to assign his tenancy for a capital sum, as is allowed in the commercial world. I have been unable to put down an amendment for this stage. I apologise for the fact that I got totally bogged down with the drafting. As so many amendments relating to retirement were put down, I thought that I would wait for this discussion and come forward with an amendment at the Report stage. I hope my noble friend will take this matter into consideration when thinking about the problem of retirement.

The Earl of Kinnoull

We are all grateful for the contributions which have been made on this subject. Of the three amendments at which we have been looking, mine is the gentlest, while those of noble Lords opposite are the hardest. They go soft, hard, hardest. Funnily enough, I agree with the noble Lord, Lord Northfield, who leaves it to the agricultural land tribunal to decide the issue. I hope my noble friend will not duck the sensitive issue of allowing the landlord as well as the tenant the choice of electing to go to the agricultural land tribunal.

The sort of case which obviously will come up is where the tenant has lost some of his senses of good farming and has become extremely aggressive or difficult and is disruptive. It would be difficult, if that was effecting very bad farming—or it might come under bad husbandry; nevertheless, it would be difficult if one could see that he was no longer prepared to be conciliatory, even for the rights of his son and those who might succeed him.

My noble friend suggested that my own amendment was a bit compressed. I will only say that it was compressed with a refreshing air compared with Clause 1, which is not compressed. I hope that my noble friend, when he comes to look at Clause 1, will help to compress it further. I am happy to withdraw my amendment. My noble friend has given a handsome assurance that he will look very carefully at this important subject and will seek to obtain a fair provision of voluntary retirement. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

6.11 p.m.

On Question, Whether Clause 2 shall stand part of the Bill?

Lord Bishopston

I wish to move the Motion standing in the name of my noble friends in relation to Clause 2. This clause deals with the succession aspects of the 1976 Act and presents and alternative to those tenants of the future. The Bill is of course mainly Clauses 1 and 2; and the intention of the Bill, as the Minister pointed out on Second Reading and since, is to ensure that more people have entry into the farming industry.

But noble Lords are far from being satisfied that the Bill does that. There has been a great lack of enthusiasm on the Government Benches, highly populated as they always are during these sessions by noble Lords who have an interest—and quite rightly so—as landlords or as tenants. I have already declared an interest as a Church Commissioner and a member of the council of The National Trust—two bodies which have enormous areas of land under various uses, and not least under cultivation; although at the moment, I am speaking of course for the official Opposition.

The noble Lord, Lord Walston, was one of many in the industry who gave a most damning view of the Bill when he said during the Second Reading, The birth is a mouse; it is no more than that".—[Official Report, 8/11/1983; col. 720]. He is quoted as saying that the primary aim of the Bill, as made out by the noble Lord, Lord Belstead, was to arrest the decline of the tenant farmer. The noble Lord went on to say: If that is the primary aim—and I accept that it is—then I must say quite frankly that it has failed". He was not the only one. The noble Lord, Lord Stodart of Leaston, stated that he took a more favourable view, but he said: Other than the NFU and the CLA, organisations which have written to me about this Bill seem to concentrate on two points. They say that to remove the succession laws would be of minimal benefit. They say that it will be far too slow and will create two kinds of tenants".—[Official Report, 8/11/1983; col. 729.] That point was made also by the noble Earl, Lord Waldegrave, only a few moments ago. The noble Lord, Lord Stodart of Leaston, went on to say: and how, without indulging in retrospective legislation, could one do otherwise? They say that the rent formula is pretty useless"— and indeed the Minister himself has already very kindly—and wisely I thought—agreed to take Clause 1 back— and that the open market value is just about the only way. They say with a fair amount of unanimity that, therefore, this Bill will achieve virtually nothing". As I said out of fairness, the noble Lord, Lord Stodart of Leaston, went on to say: I take a much more favourable view than that, although I am somewhat cautious in forecasting a swift re-introduction of the farming ladder as we used to know it". So there has not been a great deal of enthusiasm, although the Bill, as we know, is a package agreed between the NFU and the CLA, and about which I make no complaint because if one can get agreement within the industry before a measure comes here, that is going some way towards getting a Bill.

I will not mention that the same precedent might be used in relation to trade union, local government and other reform; the principle of getting agreement before it comes here. That may be for another day.

So we have those comments from members of the official bodies—the CLA and the NFU—and from people talking, as noble Lords quite rightly do, from their experience in the farming industry. So I say, and others have said the same thing, that we are left with two kinds of tenants. One kind is the tenant who has the benefit of succession under the 1976 Act. That Act was brought in during a period when I was Minister of State and my noble friends had responsibility. Despite the attacks on it, the principles of the 1976 Act had the support of the NFU. Indeed, the NFU even today, in a recent letter, say much the same thing: Whilst ideally the NFU would have wished tenants of new lettings to enjoy the family succession rights available under that Act, it has accepted that it is necessary to restrict successions to existing tenancies only so as to encourage new lettings". The NFU is still in favour of the 1976 Act, but maybe to get this package they have accepted a compromise, which is before the Committee still.

The Northfield Committee report tells us very clearly that there is a need for much more information about the farming industry. To the credit of my friend Mr. John Silk in, when he was Minister of Agriculture and I was with him, we recognised that one could not answer questions in either House about the farming industry because there was a great lack of knowledge. My noble friend Lord Northfield has performed a great service to the industry by producing his report. I only wish that we could have more time to study some of its facts and recommendations.

If one reads the report, the idea of Clause 2 that one can change the present situation with that clause and overcome many of the problems which are of concern to us all is not real. The report talks about the enormous changes which are taking place in the farming industry. They went back into the last century and came in three stages, right up to the 1970s. Noble Lords will know of the enormous changes. First, there was the enormous amount of manpower needed to operate farming in the old days. We know that there has been a great deal of mechanisation and that new technology has been brought in, and that fewer people are involved. The industry has contracted in many ways as far as opportunities are concerned—not only for farm workers but also, as a result of a contraction, in the number of farms available. We have seen amalgamations taking place, encouraged by all Governments to make increasingly efficient use of agriculture. That is bound to mean fewer opportunities for people to come into the farming industry.

There are many other factors as well. We all know about the effect of the common agricultural policy. Indeed, in the debate last Thursday there was an indication of the fear many have, not about coming into the industry but about staying in the industry. More people are likely to leave the industry even as a result of the Government's policy in relation to the CAP on the dairy industry; many will leave who are anxious to stay in.

There has also been a reduction in the number of opportunities caused by county councils selling smallholdings, and there has been the Land Settlement Association situation. There are all these matters to consider, apart from the points which the Government have made about the need for Clause 2 in order to stop the drift of people from the land because there is no opportunity to come in.

As I said earlier, I am a Church Commissioner and the Church Commissioners have for a very long time had the succession principle. We have a number of families who had succession for over 100 years. This has not meant that farming has gone down, that farms have deteriorated. Indeed, we all know that those who believe in the 1976 Act principles believe in having the best kind of farmers, able to make the farm viable; otherwise, of course, it is bad for all concerned.

Of course, when we are talking about rents and conditions of farming, we have to realise—and when I was a Minister I mentioned this to many meetings of the NFU—that on the one hand it is the job of Governments and others to make sure that the landlord and others in the industry can get a fair return—otherwise, there are no letting opportunities—and, on the other hand, it is also essential that the people to whom we wish to let farms are able to pay the rents demanded. So there is a very fine balance which has to be made between producer and consumer—the cost of the produce, the ability to buy it, the incentives a landlord has to let the farm and the ability of the tenant to find the rent.

Noble Lords will not need to be reminded that the number of people entering farming, or indeed staying in it, depends on taxation as well; but, of course, in this Bill we are not looking at all these aspects. I am not saying you can have a Bill covering all the aspects—financial, statutory tenancies and so forth. So we believe that this clause does need review. My noble friend Lord Prys-Davies has already said that the two clauses go together, and here we are discussing Clause 2, which is a certainty in the Bill at this moment, and we do not know what is going to come on the other part of the partnership, Clause 1.

We are hoping that the noble Lord the Minister will be pursuing the promise he made last week, and I am sure he will do his utmost. But how he can reconcile not only his own restrictions of the rent clause, Clause 1, with the objectives of your Lordships' Committee last time, running in about eight different directions, is something to be seen. But we are hopeful. I feel that this matter of Clause 2, which hangs together with Clause 1, is one which the Minister will see as requiring him to say that he will be prepared to reconsider Clause 2 in view of his promise to look at Clause 1. I hope that he will recognise some of the points my noble friends and I have made about some of the other factors over a wide range of situations which concern whether or not people enter into the farming industry. If I may say so, I think he will be well advised to say that he will look at Clause 2 and Clause 1 and come with comprehensive alternatives if possible.

Lord Stodart of Leaston

The noble Lord, Lord Bishopston, was kind enough to refer to some of the things I said on Second Reading. To make it quite clear, although I quoted, I qualified the quotations by saying that they were not my views. On the clause we are now discussing I said on Second Reading that, to me, Clause 2 is entirely basic within this Bill with a view to getting more tenancies on to the market.

I agree with the remark of the noble Lord, Lord John-Mackie, about the steady decline in tenancies and the slightly misleading figures that were given merely taking acreages of land. What I find quite astonishing, in view of the questions that can be answered, is the fact that since the Scottish legislation came in—a good many years ago now—or since 1976, nobody has apparently been able to say that in the 10 years from 1965 to 1975 X number of farms were let and in the following so many years X number of farms were let. It seems to me quite astounding. I can recall as a very junior Member in another place once asking the Minister of Public Building and Works, rather mischievously, how many pelicans there were in the Royal Parks, and what was their sex. I received the answer that there were two males and four females. I remember that my supplementary question was how the Minister knew this because certain textbooks said that the only thing that could determine the sex of a pelican was another pelican. If you could get an answer to that, how on earth is it that the two departments are unable to give us this information?

Of one thing I remain totally convinced, and that is the effect of the 1968 Act in Scotland and the 1976 Act which we are now discussing. Nothing will shake me in the belief that this did not put the most tremendous deterrent on landlords from letting farms. The attitude of the National Farmers' Union with regard to the 1976 Act has been quoted by the noble Lord, Lord Bishopston. In 1968 (I think I am right about the date) in an Agriculture (Miscellaneous Provisions) Bill applying to the United Kingdom, by some extraordinary coincidence—I was not here or in the other place in 1976, but, from what I have heard today, within the 1976 Act this provision was introduced at a slightly later stage in the Bill; but in the 1968 Act, which applied only to Scotland, it was at the Committee stage—the attitude of the English National Farmers' Union could not have been more forthright. They wrote to all of us and said there were absolutely no grounds for the hereditary system in farming; there were no valid grounds whatever for saying that a son or any near relation was likley to farm the land better than somebody from outside. To my mind, the most important thing—and I have said this before—is the farming of the land and the letting of new blood into the industry.

6.27 p.m.

Lord Middleton

I wondered what noble Lords opposite would say in regard to the Question whether this clause should stand part. As one would have expected, the noble Lord, Lord Bishopston, spoke very moderately, and with enormous experience, again as one would expect. He has asked the Government to modify Clause 2. Clause 2 is crucial, and I really do not think it could stand a great deal of modification. I have kept quite quiet during the more than two hours we have been discussing Clause 2, but perhaps I might say a word. Despite the disbelief of noble Lords opposite, and despite their graphs, the fact is that the 1976 Act did have a profoundly adverse effect on the landlord-tenant system. My noble friend Lord Stodart is quite right in saying so.

We have heard that statistics in this field are scarce. But surely the significant statistics should be the number of new lettings since 1976 as distinct from succession lettings. On Second Reading I referred to the survey which was done by the CLA of its landlord members. The replies to that survey were overwhelming: private owners were not prepared to create new tenancies. And why not? It was because of taxation and because of the succession provisions of the 1976 Act. They were unanimous. The supply of tenancies from private owners simply dried up.

The noble Lord, Lord Prys-Davies, in moving his first amendment this afternoon, told us that only the CLA wished to modify the succession provisions. But despite what the noble Lord, Lord Bishopston, has just said about this Bill being narrowly based upon a consensus reached by the CLA and the NFU, virtually the whole farming industry and all the professional bodies are asking for the succession provisions to be altered. Not only the CLA but the National Farmers' Union, the Tenant Farmers' Association, the National Federation of Young Farmers' Clubs, the RICS, the CAAV and the ISVA all support the Government in what they aim to achieve—perhaps not in precisely the same way but certainly they support the Government on Clause 2. It is difficult to find an industry that is more united on any issue.

The succession provisions are modest. They represent the very minimum that can be done to give a boost to new lettings. The main weight of criticism on Clause 2, as we have heard today, is that it does not go far enough. However, unless that minimum is done there will not be any new lettings and it will be the young who will suffer. If it is desired to be the final coup de grâce to the landlord-tenant system in agriculture then one is asking for the full 1976 Act treatment to continue for all tenancies. That is what will happen if one knocks Clause 2 from the Bill. I know that is not how the noble Lord put it, but that is what will happen and the agricultural industry deserves better than that.

Lord Renton

May I briefly say that I support what my noble friend Lord Stodart of Leaston said? When the 1976 Act was going through the House of Commons I had already represented for over 30 years a very large farming constituency and kept in constant touch with the local branch of the NFU, which was a very strong one. I had the clear impression that the Government were almost taken by surprise at the pressure exerted by the headquarters of the NFU at the time of the negotiations on the 1976 Act. It has become perfectly plain that the system of land tenure in England and Wales is, as I am afraid previously happened to some extent in Scotland, becoming fossilised. I was hoping that out of these negotiations and into this Bill we should get a system which broke, much further than the Bill does, into the rights of succession. That is in the general interest of farming and those who want to enter farming. As my noble friend Lord Middleton said, the proposals in Clause 2 are about as modest—I would almost say as ineffective—as one could possibly have expected to see. I hope, therefore, that my noble friend and the Government will not succumb to any pressure from the Opposition to make them even less effective.

Lord Belstead

I was interested in the remarks of the noble Lord, Lord Bishopston, because not only has the noble Lord very great experience of the Ministry in which I am fortunate enough to work but he was a Minister in another place when the 1976 legislation was going through. I and my noble friends on this side of the House well understand why the noble Lord felt that he should intervene at this moment in the Bill. Indeed, we listened to what the noble Lord said with great interest.

However, I am afraid that on this occasion it does not necessarily mean that we agree with the noble Lord. It is incontrovertible, as my noble friend Lord Stodart of Leaston, also a previous incumbent of the Ministry, said, that Clause 2 is basic to the Bill. That expression of view was echoed by my noble friend Lord Middleton, who has done so much work in making it possible for the Bill to come forward.

I apologise to my noble friend Lord Stodart of Leaston because it is not possible for my department to produce figures on the decline in the number of tenancies. I must apologise for the fact that I have spoken on previous amendments about the decline in area: my noble friend was right to take me to task in saying that that does not give a very good picture. My noble friend said that it seemed to be possible to find the number of pelicans in the Royal Parks so why was it not possible for the Ministry of Agriculture to give the number of tenancies in this country from year to year? I can only say that I think the reason is because over the years landlords have resisted surveys rather more successfully than have the pelicans in the Royal Parks.

The noble Lord, Lord Bishopston, was, of course, defending his own legislation. But the noble Lord will acquit me of discourtesy if I say that over a period of seven years it has been judged and found wanting. The noble Lord, Lord Northfield, and his committee—I must not misinterpret what the noble Lord and his committee said because they did not reach exactly the same conclusions as are in this Bill—were quite clear that the 1976 Act had not succeeded. In his wind-up speech on Second Reading my noble friend Lord Swinton was quite clear from his own personal experience that the 1976 Act had not succeeded so far as his own family lands were concerned. Who was it who, seven years ago, were also quite clear that the 1976 Act would not succeed? It was the National Federation of Young Farmers' Clubs, which could see quite clearly, where perhaps others did not see quite so clearly, that unless young farmers were of the family of a tenant by succession the legislation of that year would create a situation which would make it precious difficult for them to succeed to a tenancy at all.

It is for that reason that the Government believe that we must look to the future and that we must do our best so far as we can in this Bill to see that we take a step in the right direction. The noble Lord, Lord Bishopston, who is always fair in the way he speaks, will forgive me if I say that not the noble Lord or his noble friends on the Front Bench but his party would do much for the future of tenanted land if it would rethink both its fiscal policies towards tenanted land and its policies towards public ownership and tenanted land.

For our part, therefore, we are determined, and my right honourable friend the Chancellor of the Exchequer has shown it this year, to try as best we can to take fiscal steps in the right direction. The second Finance Bill this year has proved that. In this Bill, we believe that Clause 2 will be another step in the right direction. As my noble friend Lord Renton said, the clause is so fair that it has been criticised by my noble friends on previous amendments as being too fair. But sometimes that is not a bad fault. For us to be able to say that we are bringing in a Bill which ends legislation which we do not like but at the same time is not retrospective and which protects the situation where a chain of succession has been establised, is the right way to proceed. That is why we intend to stand by Clause 2.

Lord Mackie of Benshie

I was fascinated by the noble Lord's instruction to the Opposition to rethink their fiscal policy towards the landlord-tenant system. Does that mean that the Government are rethinking their fiscal policy?

Lord Belstead

What I meant was that this year we built upon the Finance Act 1981 by extending capital transfer tax relief from 20 per cent. to 30 per cent. As was explained at the time, that was supposed to be a positive inducement to owners to let land. Six months ago the Labour Party said in its manifesto that it would reverse most of the Conservative Party's concessions on capital transfer tax. That is what I meant.

Lord Northfield

I should not have intervened on this matter but for the joke about the pelicans, which, if I may say so, unfortunfately got taken rather too far. It enabled the Minister to have a throw-away line and to say that we do not know anything because landlords resist surveys. With respect to the noble Lord, Lord Belstead, that just is not good enough.

In paragraph 282 of our report we made it quite clear that the sort of information which we desperately need about occupancy of land in Britain—and which, if I may say so, we shall need more and more as the tenancy sector declines, and more and more charges are made about who is responsible and what will relieve the situation—could readily be provided by similar means to those used in Scotland at the moment. Every June the Scottish census form asks questions which enable a sensitive appraisal to be made of the trends in land occupancy in Scotland. In paragraph 282 we suggest that the Ministry of Agriculture, Fisheries and Food should extend the June census in England and Wales on the lines of the Scottish experience so that we can take account of these developments in occupancy.

I therefore hope that the Minister's good joke—and, if I may say so, the good follow-up joke—that came from talk about pelicans will not be the end of the matter. There is a simple way in which we can have more information available. I hope that the noble Lord, Lord Belstead, will look into the matter to see whether we can have this information as the years develop.

Lord Bishopston

I think that we have had a useful debate on this matter. One of the main points in my noble friends' tabling this Motion was to get the House to realise that there are other aspects of entry into farming besides the one in Clause 2. Noble Lords opposite will be familiar with them. There is the high cost of entering farming. The high capital cost prevents many young farmers from getting a farm of their own, no matter what the availability may be. Then there are problems of taxation and the problems of loss of agricultural land, which is mentioned in paragraph 67 of the report of the noble Lord, Lord Northfield. Between 1971 and 1978 the average recorded loss of land for farming in the United Kingdom was about 50,000 hectares. which as noble Lords will know is 125,000 acres. The change in farming structure is also mentioned in paragraph 64. The advance of technology means that there are fewer people working on farms. This is reflected in the number of people running farms. There is farm amalgamation. These are all aspects which, in fairness, must be recognised as factors affecting entry into farming. It would be good for the industry if the Government were to recognise these points and not to think that because they have brought forward this Bill they have solved the problem.

After all, succession has a lot to commend it. A family investing in a farm put capital and work into it. The husband and wife may run the farm, or the wife may be helped by the husband and the sons, and so on. They know that there is long-term security. People talk about succession in the 1976 Act meaning that there is a blight on entry, but the sons and daughters of the tenant can come in. They are young people with young blood and new ideas. We should consider the entry into the industry of those who are heirs of others who have farms. I and my noble friends are not defending what the Labour Government did in 1976. If we felt that there were shortcomings, we should be happy to change them.

As I said earlier, noble Lords opposite are notable by their lack of enthusiasm for this measure. They may be saying that they do not like the present position and this is the only alternative presented and therefore they must support it. It has been helpful to the Committee that in the debate in the past few days on this measure noble Lords have felt free to express a variety of views which we all hope that the Government will take into account. We value the fact that the Minister has said that he will look again at Clause 1. Good luck to him in the process. It is an unenviable task that he has undertaken. I am sure that the House hopes that the Government will look at all the other aspects of the matter which may not be in the Bill but which need urgent review, as many noble Lords have said. With those comments, I beg leave to withdraw the Motion.

Clause 2 agreed to.

Clause 3 [Amendment of provisions relating to statutory succession in cases not excluded by section 2]:

6.45 p.m.

Lord Northfield moved Amendment No. 38A:

Page 7, line 6, leave out paragraph (a) and insert— ("(a) in paragraph (c) of the definition of "eligible person" for the words from "he is not" to "licensee only" there shall be substituted the words "he is not a person to whom the provisions of subsection (2A) apply;" ").

The noble Lord said: I hope that your Lordships will allow me to suggest that we can take seven amendments together at this point and thus make considerable progress in a few minutes. I suggest that we can take with Amendment No. 38A, Amendments Nos. 39, 40, 41A, 43, 43B and 72A. That may save time. The noble Earl, Lord Swinton, as Deputy Chief Whip, will be pleased that we are making good progress.

The Earl of Swinton

The Deputy Chief Whip is very pleased. I wonder whether the noble Lord will repeat those numbers.

Lord Northfield

Amendment No. 38A is really a paving amendment for Amendments Nos. 41A, 43B and 72A. Then we have Amendments Nos. 39, 40 and 43, which I suggest can be discussed together with these because they were early attempts to do the same work that is done by Amendment No. 38A and the amendments consequential on it. I shall not be moving the latter amendments if we reach a satisfactory conclusion on Amendment No. 38A. I repeat again that the amendments which I suggest we can take with this amendment are Amendments Nos. 39, 40, 41A, 43, 43B and 72A.

Amendment No. 39:

Page 7, line 11, at end insert— ("(aa) in paragraph (c) of that definition after the word "not" there shall be inserted the words "at the date of death";").

Amendment No. 40:

Page 7, line 11, at end insert— ("(aaa) in paragraph (c) of that definition after the word "occupier" there shall be inserted the following words— as tenant, joint tenant, partner, owner, joint owner, or through a share in a limited company".").

Amendment No. 41A:

Page 7, line 19, leave out subsection (3) and insert— ("( ) After section 18(2) of that Act there shall be inserted the following subsection— (2A) The provisions of this subsection apply to any person whose circumstances, either at the date of death or at the date upon which he makes an application under section 20 of this Act or any such application is heard by the Tribunal, are such that there is available—

1. (a) to him; or
2. (b) to any person with whom he is engaged in partnership; or
3. (c) to any body corporate of which any part of the issued share capital is owned beneficially by him or on his behalf;

an amount of agricultural land which—

1. (i) is available as aforesaid for the purposes of carrying on an agricultural business by him or any such partner with him or any such body corporate; and
2. (ii) is owned in fee simple or is held as an agricultural holding under a contract of tenancy by or for and on behalf of himself or any such partner or body corporate (either solely or jointly with any other person); and
3. (iii) is sufficient to enable him to derive from that business a livelihood which is adequate for himself and any person dependent upon him,

and in determining whether any such land is sufficient there shall he taken into account in addition to the needs of the person in question the needs of any other person whose livelihood depends upon the business conducted on that land and whose needs it is reasonable to take into account." ").

Amendment No. 43:

Page 7, line 28, at end insert— ("(3A) In section 18(4) of that Act (exceptions to the right to statutory succession) after paragraph (e) there shall be inserted the following paragraph— (ee) if, on application for a notice to quit made by the landlord to the Tribunal within three calendar months of the death, the Tribunal is satisfied that the eligible person is already holding a tenancy, joint tenancy or tenancies which form a viable economic unit or units, taking into account the productive capacity of the land, and that the landlord is willing to create and let a new agricultural holding that includes the land to which the notice relates;".").

Amendment No. 43B: Page 7, line 29, leave out subsection (4).

Amendment No. 72A: Page 29, line 55, column 3, at end insert ("Section 18(6)."). We are here discussing a very difficult part of the 1976 Act. We are dealing with who is and who is not eligible to succeed to tenancies under the 1976 Act. We are dealing with Section 18(2)(c) of that Act. That is what all these amendments are about: who is and who is not eligible to be a successor. The intention of paragraph (c) was to exclude potential successors who already have a holding which gives an adequate livelihood. The facts are that the Act has not worked out in that respect. It was also the intention of that Act to include as a successor someone whose present holding is as a licensee on a precarious tenancy. That was the clearly expressed intention of that paragraph.

I and the noble lords who are co-sponsoring this amendment and the consequential amendments (Amendments Nos. 41A, 43B and 72A) are greatly indebted to Mr. Derek Wood, QC, of the Agricultural Law Association, who has provided a brief which shows the intense legal complexity that has resulted from the failure in clarity of that part of the 1976 Act. I have made sure that that is available to the Minister's office. It is the Agricultural Law Association that has provided these substantive amendments beginning with 38A plus 41A, 43B and 72A.

Without going into all the cases, some of which have reached your Lordships' House for decision, I think that the criticisms of the 1976 Act are what I shall now describe. The section as drafted has failed to shut out some successors who do not need the tenancy. I see the noble Lord, Lord Middleton, nodding his head in agreement. That is certainly true. Some people who do not need the tenancy have actually managed to succeed and some deserving would-be successors have been undesirably disqualified. Some people who ought to have had succession have been disqualified. The prime sort of example is where several partners jointly are occupying a unit. For instance, three or four partners are operating a unit and have tenancy of it, and this holding is a commercial tenancy within the meaning of the Act, but it is not big enough, if taken alone, to provide a living for all those partners. The problem arises when it is not possible to bring a group of four people squarely inside the terms of the Act and they suddenly find themselves disadvantaged.

The word "licensee" has proved totally ambiguous. A licensee, I would remind the Committee, is someone whose holding is on a precarious tenancy and he was therefore to be allowed to succeed. But what some artful tenants have managed to do is to set up all sorts of evasion strategies and artificial schemes, making themselves, for example, into family companies which then become treated by law as licensees. The result is that if you already have a holding which is a good commercial unit and, under the test of the 1976 Act, you should not succeed to this particular unit on someone's death, if you transform yourself into a family company, you can get treated as a licensee and get the tenancy anyway, totally, against the intentions of the 1976 Act.

My own Committee pointed to this and other ambiguities and evasions that were going on. We suggested in Paragraph 629: It would need to be made clear that an applicant would not be eligible"— to succeed, that is— if, at the time of death of the existing tenant and taking account of the terms of his will, the applicant was effectively farming a commercial unit whether sole owner, tenant, in partnership or by means of a company".

Amendment No. 38A, plus the more important Amendment No, 41A, which is the substantially drafted part of the group, would have the following intention. I quote Mr. Wood in his brief: The tribunal should principally consider the question whether the applicant,"— the would-be successor— if denied a new tenancy of the holding, would be able to derive a sufficient livelihood for himself and his family from an agricultural business carried on by him or by some person on whom he is dependent upon agricultural land other than the holding. The tribunal should be empowered to form a broad view of the case".

That is the intention of our amendment. I believe that it carries it out. But the amendment also points to the disadvantages in the Government's present drafting. The Government drafting leaves all the confusion attaching to the word "licensee". We must sweep that away and get the matter resolved once and for all. It fails to deal with a unit occupied by more than two occupiers. That is the sort of example I was giving earlier. There are, besides, all sorts of blemishes in the present Government drafting. For example, what is the meaning of "net annual income" of the unit already farmed? What you have to say, if the Government are relying on that phrase, is that someone has a good net annual income from the unit already farmed and therefore does not need to succeed to the tenancy. What is the net annual income? It is nowhere defined. There can be limitless arguments about what it all means and what is to be taken into account, interest on capital, et cetera. Our amendment tries to deal with all these things comprehensively. I hope that it commends itself to the Government and to the Committee. I beg to move.

Lord Renton

The noble Lord, Lord Northfield, on one hand, and my noble friend Lord Kinnoull and myself, on the other, tabled the Amendments Nos. 38A, 41A, 43B and 72A to which I wish to speak without knowing that each other had done so. I am glad that the name of the noble Lord, Lord Northfield, appears first on the Marshalled List because these amendments are an attempt to carry into drafting form the recommendations of the committee of which he was chairman. I do not need to say very much to add to what the noble Lord has said. The noble Lord, no doubt due to his usual modesty and moderation, did not mention that these amendments follow from the report of his committee. I think I should invite the attention of the Committee to the fact that the final sentence in Paragraph 629 of the report states: It would need to be made clear that an applicant would not be eligible if, at the time of death of the existing tenant and taking account of the terms of his will, the applicant was effectively farming a commercial unit whether as sole owner, tenant, in partnership or by means of a company". That is the main intention underlying these amendments. Clearly, the present law is unsatisfactory, especially in relation to the definition in Section 18(2)(c) of the 1976 Act which attempts to define "eligible person". That has caused a great deal of trouble in the courts. Twice in 1980, hair splitting decisions had to be made by the Judicial Committee of your Lordships' House. Their Lordships were not agreed in one of those cases. It was an extraordinary situation for us to reach. So something must be done.

The trouble with the present law, as the noble Lord has indicated, is that it lets in well-provided applicants who do not require the benefit of the succession terms of the 1976 Act but it keeps out some people who could do with succession and who, if there is to be succession as a principle, can be said to need it. The Bill attempts to improve the situation but does so by means of a new definition that I find rather strange. It links the rights and the decisions that have to be made to the concept of full time employment of two people on the holdings. In some cases, that might do; but in other cases, it might not. It is much too inflexible a thing to write into a statute in my opinion. Also—and I am not sure that this is a wise thing for it to have done—that viability of the unit is no longer to be decided by the unchallengeable certificate of the Minister of Agriculture. That is a system which under the present law, I understand, is working not too badly.

In these amendments, we do away, I hope, with the legalistic criteria which have caused trouble in the past and introduce a new test that implements the recommendation of the Northfield Committee to which I referred. It is neither pro-landlord nor pro-tenant, but it is intended to confine the benefits of succession under the 1976 Act to those in genuine need. Mr. Derek Wood, who drafted these amendments, has been so good as to say that he thinks that they could be further improved, and no doubt the Government will consider whether that is so. But surely the principle is right.

Lord Middleton

The "commercial unit" test has indeed caused serious problems and conflicting decisions of the ALTs. These amendments would deal with a number of unanswered questions. As we have been reminded, the policy of the 1976 Act is to exclude close relatives from obtaining a succession tenancy where they have the advantage of a viable unit elsewhere. By getting away from the difficult problems caused by having to decide whether an applicant is the occupier of a commercial unit and whether he is occupying it as a licensee only, these amendments make the law clearer. They also fulfil the policy of the 1976 Act better, by providing a livelihood test rather than an occupation test.

I fully support what these amendments are trying to do. I must say that I am not sure how a livelihood test would be applied in practice, nor how one measures what is an adequate livelihood. However, subject to that, I join the noble Lord, Lord Northfield, and my noble friend Lord Renton in preferring these amendments to what is now in the Bill in subsection (3). I hope that the Government will be sympathetic.

Lord Stanley of Alderley

I also agree with the noble Lord, Lord Northfield, that there has been trouble in the past over whether one is eligible or not. What I think we do not disagree on is the principle. As I understand it, the principle that we are all trying to get at is that we want to exclude someone who is tenanting or owning and farming another viable holding. But, rather like my noble friend Lord Middleton, I am concerned as to whether the amendment achieves that.

There are three matters at which I would ask my noble friend, Lord Belstead, to look very carefully. One of those matters concerns subsection (2A)(i). It says that the holding "is available". If a tenant owns another farm but cannot get possession of it, is it available? Is he, therefore, disqualified even though he cannot get possession of it? I do not know. Another matter arises under subsection (2A)(i). If he is in partnership or part of a body corporate with an interest in the farm does that also disqualify him? Finally—and this is most important—I take up the point made by the noble Lord, Lord Northfield, that at present there is reference to the term, "net annual income". Is that any more difficult than the words: a livelihood which is adequate for himself"? That seems to me somewhat vague. Is it for me or is it for my noble friend Lord Renton? Our needs might be totally different. I am worried about whether it achieves our objective, but, if it does achieve what we all want, then I welcome it.

Lord Northfield

On the last point raised by the noble Lord, I think that "net annual income" is a technical term that needs definition. "A reasonable livelihood" would be something for the tribunal to make a judgment about. That is the difference between the two.

Lord Walston

I only want to say that I agree with the noble Lord, Lord Northfield, that the present Act has not worked well in this respect. It may have worked well from the point of view of lawyers who have been consulted and who have even brought cases as far as your Lordships' House, but from the point of view of both tenant and landlord it has created a great deal of uncertainty. It needs modification. On the face of it, the proposals put forward in these amendments look as if they should do it. I cannot pretend that I am qualified to give them my full approval. They obviously need very close study, and they need study by those who are expert in these matters. But the ideal behind them is correct. I hope that the Government will accept them in that spirit.

Lord Renton

In view of what the noble Lord, Lord Walston, has said about members of our profession, I think it only fair to point out that it was members of the Agricultural Law Association who used their initiative to draft the amendments to fulfil the recommendation of the report of the noble Lord, Lord Northfield.

7.4. p.m.

Lord Prys-Davies

I am not sure that I fully understand the significance of all the amendments, but for that I blame myself rather than my noble friend's drafting. Certainly one goes along with any amendment that will help to clarify the law and make clear that which is unclear.

The noble Lord, Lord Northfield, also referred in passing to his Amendment No. 43. I was in considerable difficulty with Amendment No. 43. As I understand it, the thrust of the amendment is in the following direction. First, one has to define what is "a viable economic unit". I am not quite certain whether the noble Lord will in due course give us a definition of "a viable economic unit", but does it also mean that, if the landlord offers him an acreage of land additional to his existing holding, he would thereby—if it were a viable economic unit—lose his right of succession under the Act?

Lord Northfield

I wonder whether I can help my noble friend at this point and also save the time of the Committee. Amendment No. 43, together with Amendments Nos. 39 and 40 were early attempts to meet the points we have been discussing. They were amateur attempts by me at drafting. It was when Mr. Derek Wood and the Agricultural Law Association provided us with Amendments Nos. 38A, 41A, et cetera, that we realised that there was a much more professional way of doing the whole job. That is why I said that we could discuss them together. But my intention would be never to move Amendments Nos. 39, 40 and 43 if the Minister were to accept Mr. Derek Wood's suggestions in Amendments Nos. 38A and 41A. My amendments are clearly defective and very amateurish.

Lord Belstead

I am grateful to the noble Lord, Lord Northfield, for taking so many amendments together in the interests of speed. In the interests of wear and tear on the Government spokesman I am not quite so sure whether my thanks extend quite so warmly, but I will do my best to reply. The first group of amendments which is in the name of the noble Lord, and also my noble friend Lord Renton and my noble friend Lord Kinnoull—Amendment No. 38A and the other amendments which hang with it; namely, Amendments Nos. 41A, 43B and 72A—are undoubtedly important. I should like to say straight away that there are elements in these amendments which I am advised are certainly capable of adoption. but we should like to reflect on the matter further, particularly in the light of the short debate that we have had.

As I understand it, this group of amendments does two things. First, the amendments would replace the definition of a "commercial unit" as it presently appears in the existing legislation and also as it is revised in Clause 3 of the Bill. Secondly, this group of amendments would replace the machinery for assessment of such units by the Minister and leave it entirely to the land tribunal to determine whether the applicant is debarred under the test which the noble Lord and my noble friends have provided. I believe that the new definition which is included in the Bill—I am talking here about Clause 3(3), new subsection (3A)—is a sensible and a reasonable one. I believe that the new procedures whereby the certificate which is to be provided by the Ministry will in future be open to questioning in the agricultural land tribunal will be a great help. That is a provision in the Bill.

I know that I am now being critical, but some of your Lordships have pointed to Amendment No. 41A which refers to subsection (2A)(iii) and the definition: to enable [the tenant] to derive from that business a livelihood which is adequate for himself and any person dependent upon him". With respect, I do not think that that would be a very easy definition for the ALT to interpret, and I would simply leave your Lordships with that thought on that particular point.

As regards our own definition in the Bill, a very full explanation is included in paragraph 15 of the Notes on Clauses, which I deposited in the Printed Paper Office. Paragraph 15 is a very long paragraph extending to two pages and relates to the note on Clause 3. Before your Lordships are too hasty in sweeping aside the definition of "commercial unit" in the Bill, I would beg your Lordships to look at that explanation once again.

I should like to say just a few words on Amendment No. 40. If the noble Lord, Lord Northfield, will forgive me, I shall not waste the Committee's time at this hour in traversing the various definitions which the noble Lord raises in his amendment, including "owner tenant", "joint owner", "joint tenant", and so on. The real nub of this amendment, and the difficulty with which it tries to deal, is when it refers to a beneficiary, a person who owns shares in a company. This, of course, is the difficult question. The question of whether a person who owns shares in a company which occupies land should himself be considered the occupier, although the company of course is an independent and intervening legal body, is a matter which I realise is open to question.

I think that considerable caution is needed in contemplating this proposal, as it is apparent that many farmers will own equity shares in commercial companies which, for one reason or another, occupy farm land, and, clearly, it would be inappropriate to attribute ocupation of a farm held by one of these companies to an ordinary shareholder. Therefore, there may be a considerable problem in defining the family farming company, which I think the noble Lord has in mind in the part of Amendment No. 40 which deals with this particular difficult problem.

However, subject to this reservation—and I emphasise that I think it is a very important one—I believe that this is an amendment which it would be useful to examine further to see whether the legislation should be clarified. If the noble Lord will allow me to take it away in that spirit, I am very ready to do so.

Finally, I come to Amendment No. 43, which is, indeed, the amendment which talks about the "viable economic unit" test. I shall not ask the same questions as the noble Lord, Lord Prys-Davies, but there is a difficulty here which the noble Lord, Lord Northfield, has himself set. There is also one other difficulty. There is a provision in Amendment No. 43 relating to a landlord's willingness: to create and let a new agricultural holding". I think that this really might be impracticable. It would seem to me to be dubious law to provide a disqualification on account of someone else's willingness to do something. Perhaps I could just plant that thought in the mind of the noble Lord, Lord Northfield.

I hope that my reply so far has not been too incoherent, but this is a rather formidable grouping of amendments. On behalf of the Government I can certainly agree to consider Amendments Nos. 38A 41A, 43B and 37A—the first group—and also Amendments Nos. 39 and 40. I admit that I have not spoken to Amendment No. 39 at all, and perhaps your Lordships will forgive me for not having done so. However, there is the difficulty, which I have just mentioned, regarding Amendment No. 43. But I hope that I have shown my goodwill enough in looking at these perhaps to make it possible for the amendments to be withdrawn.

Before I conclude, there is one last point that I ought to mention. The question was asked as to what is annual income and how is it to be assessed. I am advised that the Ministry of Agriculture is at present in discussions with the industry and with the professions as to how income is to be assessed with a view to having an agreed basis, possibly published in a statutory instrument. But, again, this might be a matter to which noble Lords, might wish to return at a later stage of the Bill.

Lord Northfield

The noble Lord, has been more than generous and I am very happy indeed to ask the Committee's permission to withdraw the amendment. Perhaps he will consider the amendments in the three names of myself and my noble friends; they are the substantial amendments that we hope will form the basis of a new set of amendments that could come forward at the Report stage. I would simply say that Amendment No. 39 is, in fact, covered in Amendment No. 41A. Amendment No. 39 was to deal with the problem about which the courts have been exercised—the date at which certain things happen: is it the date of death or the date when application is made to the tribunal? That point is, in fact, covered at the beginning of Amendment No. 41A anyway, so it falls by the wayside as soon as Amendment No. 41A is considered.

I shall not detain your Lordships any more. This has been a very good debate and the noble Lord has been extremely constructive. I must express some faint surprise that the Government were not nearer to getting this right first time. Our report has been on the table for four years and points to these problems. I should have thought that it would be possible to have got the matter slightly more correct first time round than the Bill has so far. Nevertheless, I do not want to qualify my thanks to the noble Lord, and I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Skelmersdale

After those generous gestures all round the Committee, this might be an appropriate moment for us to adjourn for dinner and for me to resume the House. I should tell the Committee that it has been agreed through the usual channels that we shall not return to this Committee stage until at least 8.15 p.m.

I beg to move that the House do now resume.

Moved accordingly, and, on Question, Motion agreed to.

House resumed.