Town and Country Planning (Compensation) Bill

HL Deb 05 March 1985 vol 460 cc1209-48

3.2 p.m.

The Parliamentary Under-Secretary of State, Department of the Environment (The Earl of Avon)

My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.

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

On Question, Motion agreed to.

House in Committee accordingly.

[The LORD ABERDARE in the Chair.]

Clause 1 [Restriction on compensation: England and Wales]:

Baroness Birk moved Amendment No. 1: Page 1, line 5, leave out ("In").

The noble Baroness said: Before I move this amendment, may I say how sorry I was that I was not able to be present at Second Reading; but my noble friend Lord Graham—who unfortunately is not well today—did sterling work from our Benches and represented our views. In moving this amendment I should make it quite clear that I am totally in support of the general aims and directions of the Bill which is before the Committee today since it deals with issues that have given rise to concern for far too long. Unfortunately, the trouble is that the provisions do not go far enough. Here I am referring not to those few amendments which are of a wrecking nature but to the vast majority of those tabled which are, I believe, completely constructive.

The point of the amendments to which I am now speaking is quite simple; and, in moving Amendment No. 1, I hope that I may with the leave of the Committee speak to Amendment No. 3 at the same time because it is the substantive one. Amendment No. 3: Page 1, leave out lines 10 to 17 and insert ("shall cease to have effect"). I think that I should correct myself. Although I said that the point is comparatively simple, I do not think anything about this Bill or about town and country planning is ever simple. But it is relatively simple. The amendments deal with Section 165 of the Town and Country Planning Act 1971 by effectively removing its power. In other words, the right to compensation would he withdrawn, both where there is a national amendment to a general development order and where there is a direction without any residual period during which a claim can be made. It does away with the 12 months' leeway for claims to be submitted. This part of the Bill is designed to take away compensation rights when planning permission is refused in particular circumstances, so why allow 12 months as an invitation to those who might have a latent claim but have never tested it?

In another place at the Second Reading of this Bill the Under-Secretary of State for the Environment referred to this as an arcane by-way of planning legislation. I could not agree more. I am familiar with the explanation for the 12 months' period given in another place at Second Reading: that money may be spent in order to get the facts together; but I am not convinced by that. I have with me a copy of a brief which was prepared in 1983 when the Government laid before Parliament two orders amending the Town and Country Planning General Development Order and the Town and Country Planning Use Classes Order to introduce controls, which were certainly long needed, over the introduction of hazardous substances. The brief was prepared by the Association of Metropolitan Authorities, but I understand that the Association of District Councils and other local authority associations were sympathetic to these proposals.

One of the weaknesses that was identified in the order was that, although to a limited extent control over hazardous development would be improved, a compensation liability would exist. The AMA emphasised that one solution would be amendments to the principal Act, coupled with changes to compensation provisions. The brief confirms that the question of compensation was raised with the Department of the Environment in response to their consultation paper on hazardous development which was published in 1982, however, at that stage the department argued that in many cases negotiations with the manufacturer or site operator would overcome the likelihood of compensation being claimed. This seems to be a most forlorn hope and a pathetic case to make because if there is not compensation on what basis can negotiations take place?

The department also argued that the use of the new powers would essentially be a matter of local choice and priority, but again this was considered to be totally unsatisfactory and the AMA made it clear that the only way that a planning authority would be able to avoid a compensation liability was by granting permission for a development which for health and safety planning reasons it was convinced should not be allowed. The orders went through unamended and so the problem still remains. This legislation that we are debating today is most urgently needed, but not the 12 months' period of grace.

I must ask the indulgence of noble Lords if my speech in moving this amendment is a little long, but it is a very important one and it needs to be spelled out very thoroughly. The need for legislation was also brought out in a decision of the Court of Appeal in an action between Joan Jones v. The Metropolitan Borough of Stockport on 8th December 1983. The decision highlighted the failure of successive governments to update general development orders since 1948 as the argument related to the use of land for the purposes of agriculture. Lord Justice Lawton referred to the fact that the GDO had undergone a near revolution, particularly in the area of extensive livestock farming. It is not necessary to go into the detail of the action, as Lord Justice Purchas went beyond the disposal of the two appeals to provide a decision on a number of related matters as requested by the Bar.

However, in the course of the judgment it was pointed out that the court had to struggle to interpret anachronistic phraseology which was out of step with the present practical agricultural context, and this is the same sort of arcane by-way which was referred to by the Minister. It was immediately realised that an amendment to the general development order was urgently required and proposals were prepared. Indeed, I understand that a whole package of amendments is currently under consideration by the Department of the Environment, following discussions with the local authority associations possibly awaiting the passage of this Bill.

The point I am trying to make is that it is equally necessary that, when these long overdue amendments do come into effect, there shall be no residual entitlement to compensation because someone is no longer enabled to do something that might well have seemed reasonable in 1947 without planning consent but which in the cold current light of 1985 is far from satisfactory on planning grounds. It is perhaps pertinent at this point to remark that it is equally necessary for Government to look at changes in the Use Classes Orders, which have remained virtually undisturbed since 1947 despite strong pressures from the AMA and, I understand, the other local authority associations to the Secretary of State.

It is true that there are relatively few positive examples of compensation claims, but they are emerging. I shall not say "mushrooming" because we heard quite a lot about the mushroom farm at Lancaster and the Article 4 direction on Second Reading. I understand, though, that there has been a claim in York relating to a hot-food take-away which enjoyed certain rights under the Use Classes Order, and several cases related to the limitation on parking caravans to 28 days in any one year introduced by an amendment to the General Development Order in 1968.

One reason for the absence of claims which should not be underestimated is the fact that planning authorities are aware of the true situation and frequently find it necessary to advise their committees of the possible compensation implications of a planning decision. In other words, the correct means of judging the problem is certainly not by the number of cases or the amount of compensation paid out but by the number of planning permissions which have been granted in circumstances where, were it not for Section 165 of the Town and Country Planning Act 1971, planning permission would have been refused.

This means that a great deal of bad planning goes on because of this fear of having to pay compensation, which is then paid even before the whole thing is heard thoroughly. The permission is given in order to avoid paying a heavy amount of compensation. It is not without significance that a London borough obtained counsel's opinion which made it clear that liability to pay compensation is a material consideration in considering a planning application under Section 29 of the Town and Country Planning Act 1971, and is a consideration which must be weighed by a planning authority against any planning objections which may arise on a particular development.

At Second Reading in another place the Minister implied that, while the concern of planning authorities was understandable, there was really little evidence of a problem at the present time. The 12-month period of grace was defended to enable those with schemes to submit planning applications. But where is the logic of this argument? Do not forget that we are not talking about 12 months from today but 12 months from the date of each and every revocation or amendment of the development order or of an Article 4 direction in one amendment. The Minister conceded that development orders are not permanent and that the risks of losing planning permission granted by development orders are not sacrosanct, so why allow any period of grace? Let us remove this anachronism in the arcane by-way of planning law, and let us do it in a clean and tidy manner.

The world has moved on since 1947, and it is regrettable that successive Governments—it is not a question of blaming the present Government—have not previously realised that it is not right that large quantities of highly charged chemicals should be available without limitation on planning grounds. It is wrong that intensive farming methods and all that implies can go unchallenged. It is right that development orders should be amended. I ask the Government to expedite the package they have in their pigeonhole as quickly as possible.

3.15 p.m.

It is equally wrong that for 40 years compensation rights have existed in this type of situation. We are going back now to a time when the attitudes to property, and the whole scenario, were entirely different. It is time that we really faced up to this and asked, "Why on earth are we continuing to allow this compensation to be paid, which is a tremendous toll on local authority resources and finance?" It is unlikely that central Government will take it on, and, in any case, why should they, because it should not be there at all. There is hardship when there is an increase in national health charges or in income tax, in fuel tax or in the thousand and one other taxes with which the Government dabble, both at Budget time and at other times of the year, so why on earth should we be so protective and so conservative (with a small "c") as to allow a 12-month period of grace in the type of situation about which we are talking today? The time has now come for change—a change which is more radical, it is true, than what is proposed in the Bill, but a change which will do the job very much better. I beg to move.

The Chairman of Committees (Lord Aberdare)

As the noble Baroness spoke to Amendment No. 3, I should point out that if Amendment No. 3 were agreed to I could not call Amendments Nos. 4 to 9.

Lord Sandys

In rising to introduce this amendment the noble Baroness commented that the subject of planning, and especially this particular area of planning, is one of great complexity. Your Lordships' Committee would heartily agree with those sentiments, but I would draw the attention of noble Lords to the fact that there is a little star, a little asterisk, against both Amendment No. 1 and Amendment No. 3. Both these amendments, if I may remind the noble Baroness, have seen the light of day in the Marshalled List only this morning, having been put down over the weekend.

We are in some difficulty over a very complex area of planning. The noble Baroness has referred to the judgment of Lord Justice Purchas and to other matters of considerable complexity to which I am sure a number of your Lordships will wish to refer. It seems that perhaps at a later stage in the Bill it would be of enormous help if amendments of this importance reached the Public Bill Office a little earlier.

Lord Lloyd of Kilgerran

We are pleased to see the noble Baroness here today, and we are sorry that the noble Lord, Lord Graham of Edmonton, is unable to be here. I agree with the noble Baroness that the removal of the mischief to which the Bill is directed is long overdue, but, as is inevitable in relation to matters of this kind, when you are removing one mischief you may be damaging other arrangements which should be allowed to continue.

I think that this period of grace of one year to which the noble Baroness refers is too short. It is not a period that should be abolished; and, as I shall be saying in relation to subsequent amendments, the farming community will be damaged, in my submission, and, indeed, in the submission of the National Farmers' Union, if a period of grace of longer than one year is not introduced in the circumstances here. I certainly cannot support this amendment.

Viscount Dilhorne

I should like to support the amendment of the noble Baroness. It has a great deal to recommend it, and I concurred with practically every word she said. The noble Lord, Lord Lloyd of Kilgerran, has referred to the problems of agriculture. I must admit that these are problems that I have not really fully considered nor fully understand in this Bill, so I am unable either to support or to oppose what he said.

I intervene to say that, if there are problems relating to agriculture, they are or seem to be very different from those relating to the real problem, to which the noble Lord, Lord Lloyd of Kilgerran, referred, of developments within central city areas, where the cost of compensation is exceedingly high. If that is so, I would urge my noble friend the Minister to consider at Report stage taking out those provisions relating to agriculture or excluding them and considering them as a separate package from these provisions, which need rapid and remedial attention.

I apologise for not being present at the Second Reading of this Bill; my absence was unavoidable. I hope that what I say now does not necessarily repeat what was urged then. Lord Justice Purchas referred to the fact, as did the noble Baroness, that Section 165 is phrased anachronistically. The compensation provisions—and this ought to be made clear right at the start—are applied by this section to the withdrawal of permission granted by a development order. That is the extent and limit of their application. They may be withdrawn in terms of that section by revocation, by amendment, or by issue of a direction under Section 24 of the Act. It is then that Article 4, under the Town and Country Planning General Development Order 1977 (No. 289), makes specific provision.

The Minister in another place referred to that which was not being attacked; where a landlord or a landowner has firm proposals for carrying out development permitted by the development order and has actually incurred costs such as those of drawing up plans and buying materials, and any other costs incurred on a full planning permission, his right to compensation under this Bill, as I understand it, will remain strong and clear.

The reason for this Bill is that under the present terms of Section 165 the right to compensation contains no time limit. That liability can apply to a planning application many years after the applications has been made or after the revocation of the amendment of the development order. I believe we are all agreed that that is a bad thing to happen. Because that provision has been in existence since 1947 and because, as I understand it, the rest of the Act has effectively disappeared, it is anachronistic.

I would therefore urge my noble friend to consider starting afresh by removing the whole of Section 165, by making it clear to what exactly it applies. I realise that that is perhaps asking for the earth and may lead to one or two difficulties. But the rationale of the amendment to which I have put my name is that the local planning authorities should not have to bear the cost of paying compensation for any amendment imposed by the government or by the Ministry concerned; that is to say, any amendment that is made to the general development order. Under the present Act there is no way of avoiding that. Under the amendments as they stand there is no way of really avoiding that.

There is nothing more I can usefully add, except to say this in respect of a compensation measure passed in 1947 to enable, as I understand it, persons who were deprived of a right they then had (before the passing of that Act in 1947) to develop their property as they wished. There are probably many persons now in ownership of property who were not then in ownership of property, when that Act was passed, and who were not in the minds of the legislators at that time. It seems strange that compensation should now be payable when in most other cases a statute of limitations might apply. Certainly it would apply if in 1947 those people had said that they required compensation under that Act and had then applied for it. I support the amendment of the noble Baroness.

Lord Mottistone

I, too, should like to apologise for having not taken part in the Second Reading of this Bill. It is interesting that my noble friend Lord Dilhorne said that he thought there might be a case for agriculture being excluded. But the amendment does not say that. I shall be making the case—not now, but when we reach my Amendment No. 6—that industry, too, would be most unfairly treated if this amendment were to be proceeded with and accepted. I shall make my main arguments at a later stage, but suffice it to say at this point that the principle which lies behind what the Government are trying to do is one with which I think we all agree.

My noble friend Lord Sandys was absolutely right when he said that the starred amendments have come before us very late, being complicated amendments to a complicated Bill dealing with a complicated subject. It is very unfair to us all that we are not enabled to tackle these matters earlier. That is very unfortunate. Taking that into account, together with the concession which my noble friend Lord Dilhorne made, I believe that it would be very much in the interests of your Lordships' Committee not to accept Amendments Nos. 1 or 3, nor any of the amendments which have been added at a later stage.

The Earl of Avon

I should like to welcome the noble Baroness, Lady Birk, to this stage of the Bill and at the same time to commiserate with the noble Lord, Lord Graham. I am sure that he would have wished to be here, and I send him all good messages. With respect to the noble Baroness, Section 165 has an important function which should be retained. When permission is given by a development order, this creates certain expectations on which people rely. They incure expenditure on professional fees: they enter into contracts to undertake development permitted by the order. It would be quite wrong to retain the powers to withdraw the permission, whether by amendment of the order or by directions under Article 4 without the entitlement to compensation for those who have not actually begun the work but have incurred expenditure in reliance on the permission.

When we were framing this Bill we looked into the possibiility of limiting compensation under Section 165 to those cases where expenditure had actually been incurred in the way I have described and where the revocation of the order had thereby left the landowner with a bill for expenditure which had turned out to be abortive. We concluded that that was not a practical approach. Any such test can be got round or abused all too easily. That is why we concluded that the compensation entitlement should be restricted to cases in which an application for planning permission is made within a year of the revocation or amendment of the order by which permission for development in queston is withdrawn. I am aware that we shall be discussing that time limit and I will say here only that in our view it is the correct one. To remove the period of grace entirely, as the noble Baroness proposes, would give rise to injustices, which would be quite unacceptable.

There is one other point that I should make. The amendment would remove any right to compensation for an adverse planning decision which follows the making of an Article 4 direction. We shall be discussing later whether it would be right to restrict compensation to applications made within a year of the conformation of a direction. But it would be wholly unacceptable to take this right away entirely. Indeed, a later amendment put down by the noble Baroness opposite suggests that she herself recognises this.

We have brought forward the Bill partly because of the need arising from the orders to which the noble Baroness referred. However, since these orders came into force we have had no evidence that the existence of a potential compensation liability has, in practice, given rise to problems. My honourable friend made clear in discussing the order in another place that the department would consider the position of any authority facing severe financial difficulties. However, no such application has been made. I do not believe that the hazards order demonstrated that Section 165 is unnecessary, but only that the right to compensation should be restricted; and that is what the Bill already does.

The aim of this Bill is to rectify a specific abuse. Everyone seems to be jumping on the bandwagon. I believe that what I have heard so far in this Committee this afternoon shows the need for consultation before we go outside the aims of the Bill. My noble friend Lord Dilhorne asked that we start afresh. In this complicated field we certainly need to move more slowly than that. There are already enough differences of detail in this Committee to underline my point. I believe that the Committee will not be in great accord, as we have already discovered with my noble friend Lord Dilhorne and the noble Lord, Lord Lloyd of Kilgerran. I hope that the noble Baroness will feel able to withdraw her amendment.

3.30 p.m.

Baroness Birk

I first apologise to both the noble Lord, Lord Sandys, and the noble Lord, Lord Mottistone, and other noble Lords, for the lateness in tabling the amendment. Frankly, one of the problems was that we are having the Committee stage two days earlier than we should have done and this particular amendment literally arose over the weekend. It seemed to me better to table it and to have an initial discussion on it because I was obviously not wrong in guessing that the Minister would not say this afternoon, "Yes, that is lovely. We accept it. Do not bother about it any more". At least the amendment is on the Order Paper. We have had a certain amount of discussion on it and there will be an opportunity to go into it in further detail later.

The noble Lord, Lord Mottistone, obviously does not like the amendment at all, and neither does the noble Lord, Lord Lloyd of Kilgerran. One of the troubles is that, quite honestly, we are into something that was created 40 years ago and it needs a tremendous shove. I am starting that shove in a small way this afternoon in order to get minds thinking differently about this very difficult subject. I think it is true, and the general consensus appears to support this, that few people will have spent money before they go ahead with asking seriously for planning permission. Even if a few people have done so, there is no complete equity in any area of our lives, whether we are talking about the fiscal side of taxation, about planning, about the social side, or anything. But it is throwing the baby out with the bath water if we do not get this change because it is allowing almost everybody else to get away with it.

The amount of expenditure incurred is very difficult to judge. I think it is quite clear that there is a certain amount, if not a great deal, of abuse and this would be the only way to deal with it. In 1947 a number of claims for compensation were made and paid out by the Government. People with golf courses and race courses claimed. But did they do anything about it? Not at all. They pocketed the compensation money and that was that. They had no intention of doing anything. That is where one gets caught. It is very difficult with the situation as it is, and as it will remain unless we get a change along the lines that the noble Viscount, Lord Dilhorne, and myself are pressing for this afternoon, to be able to judge which is real and which is false.

Obviously I am not going to pursue this matter today. With apologies again for the amendment coming so suddenly on to the Order Paper, I withdraw the amendment so that there is an opportunity to think about it and consider the position for the next stage of the Bill.

Amendment, by leave, withdrawn.

Viscount Craigavon moved Amendment No. 2: Page 1, line 8, leave out ("etc.") and insert ("or by the issue of directions under powers in that behalf conferred by the order").

The noble Viscount said: In moving this amendment I also speak to Amendments Nos. 7 and 9.

Amendment No. 7: Page 1, line 16, after ("amendment") insert ("or direction").

Amendment No. 9: Page 1, line 17, at end insert— ("(1B) Without prejudice to the generality of subsection (1A) of this section, subsection (1) of this section does not apply where planning permission for development of residential land granted by a development order is withdrawn by revocation or amendment of the order or by the issue of directions under powers in that behalf conferred by the order.".").

Amendment No. 2 is intended to be a paving amendment for Amendment No. 4, so I shall be speaking to that amendment, too, although I understand we may want a separate discussion on it later.

Amendment No. 4: Page 1, line 13, after ("order") insert ("or by the issue of directions under powers in that behalf conferred by the order").

I am speaking with the support of the Royal Borough of Kensington and Chelsea, where I have lived for most of my life. The borough is particularly concerned with the effects of compensation on Article 4 directions, particularly in relation to conservation areas. I should add that the borough wholeheartedly supports the Bill and is very grateful for the amendment which has been tabled, to which we shall come later.

Amendment No. 9 asks solely, in the case of residential property, for the 12 months in which compensation can be claimed to be abolished. I shall give an example of that later. We are asking mainly in this amendment for directions to be included in the amendment to the original Bill. I give an example of how this affects Kensington and Chelsea. Near where I live in South Kensington there is The Boltons conservation area. The problem is particularly acute there, as in many other parts of Kensington, because of the high land values. A single house in The Boltons can be worth over £2 million. It is not the object of this Bill, or the amendment, to protect the aesthetic sensibilities of such wealthy inhabitants. It is to prevent the ratepayers' money in both North Kensington and South Kensington, as well as Camden and Westminster, being spent on large sums of compensation, sometimes on projects that are never intended to be realised.

I take the example of The Boltons conservation area. In The Boltons and neighbouring streets houses and villas have been built with large gaps between them, with a view through them of trees and garden foliage. These form part of the whole layout and character of the area. This is an example of what are called "critical gaps", to which the noble Lord, Lord Montagu of Beaulieu, referred on Second Reading. Unfortunately he is unable to be here today. One of the objects of The Boltons conservation area is to protect those so-called "critical gaps", in particular by Article 4 directions. On the other hand, it is tempting for house owners with such high land values to want to expand sideways into those gaps. At present, generally speaking, either permission has to be granted or considerable compensation paid. It is the threat of that compensation that can readily distort any normal and reasonable planning considerations and thus bring the planning process and the protection of conservation areas into disrepute.

Amendment No. 9 is concerned with whether people should be allowed the 12 months in which to lodge their claims. I can give another example which happened in Kensington some years ago. I shall not give all the details as I do not want to encourage any claims for compensation, but obviously I can give full details to the noble Lord the Minister. In a particular road there were 14 identical houses. An Article 4 direction was raised to prohibit back extensions into their rather special gardens. One occupier applied for permission for such an extension and this application was naturally advertised locally. I understand that the council had letters from neighbouring owners inquiring about possible compensation in their cases. The council in this case felt forced, against its better judgment, to give permission for the extension simply because any anticipated compensation for refusal, which at today's prices would be at least five figures per house, would similarly be claimed for the other 13 houses.

It is just that sort of balance of consideration that we wish to avoid, and unless the 12-month period during which applications can qualify for compensation is eliminated, councils may be liable to pay out large sums of money. That is why Amendment No. 9 removes residential property from the 12-month period. I beg to move.

Viscount Dilhorne

I should like again to support the amendment moved by the noble Viscount, Lord Craigavon, and just add to what he has said. The effect of removing the liability to compensation where there is an Article 4 direction made by a local authority is that the local authority is in a difficult position. If the authority says that it wants to remove it by an Article 4 direction, like saying, "We support a conservation area" or refuses a planning application, and if the amendment is not passed, that local authority is in the impossible position of having made such a direction under Article 4 to preserve a particular style or type of development. But then the effect is that it negates the threat of having to pay substantial compensation if planning permission is refused. That may be done by the Minister and the proposal in the amendments to add that it may be done by directions, I understand, would achieve the object about which the noble Viscount has spoken.

Lord Mackie of Benshie

I have listened to the debate. I must say that when we hear about The Boltons, Chelsea, and so on, I think that the Minister needs to consider whether offences committed or smart moves made by operators in Chelsea and elsewhere should really affect the farmers of Wales, Scotland and other places, who are moving at a much slower pace and who are certainly not trying to do down the Government in a smart move instead of carrying out developments. I think that the trend of these amendments, and particularly of Amendment No. 9, although it mentions residential land, argues that the Government need to look with great care at all the amendments, and indeed at the original Bill, to see that they do not produce a whole set of circumstances throughout agriculture in particular which would be quite unnecessary and very dangerous.

Lord Middleton

The noble Viscount, Lord Craigavon, in moving this amendment, has justified it by reference to its intended effect on the urban scene. I must say that I have a good deal of sympathy with what he said, but I propose to follow the noble Lord, Lord Mackie of Benshie, by dealing with its possible effect on agriculture, and I am afraid that in that context I am not in sympathy with the amendment.

The effect of Clause 1 of the Bill, as I see it, is to postulate the revocation of planning permission granted by a development order. In that event a developer may be restained from carrying out a project, and, if he wants to be compensated for financial loss resulting, he must put in for planning permission to carry out that project. Then he may be granted planning permission or he may not. If not, under the Bill he can be compensated only if he has made application for planning permission within 12 months of the date on which the revocation came into operation.

3.45 p.m.

The type of situation in the countryside in which that might arise is where perhaps the Government decided, for instance, to amend or revoke Class 6 of Schedule I to the General Development Order 1977. What this and the related amendments seek to do is to bring into this clause in the Bill, as we have heard from the noble Viscount, directions, and one immediately thinks of Article 4 directions. These, provided that they are approved by the Secretary of State, can be imposed by any local planning authority in any particular area if (and I quote from Article 4): the authority is satisfied that they are expedient". If directions were to be included in Clause 1, as these amendments seek to bring about, it might provide a strong incentive for local planning authorities to impose Article 4 directions restraining agricultural development in many areas. Once the period of grace had expired—and the Bill says that this is to be 12 months—then the question of compensation will no longer arise.

It might be attractive to local planning authorities to face up to a number of claims applicable to that one year and thereafter to have no liability whatsoever, but I can see difficulties arising, on the one hand, for farmers who often are not aware of the Article 4 direction until some time after it has been approved and made. But under these proposals—and I fancy that we shall hear more about this from my noble friend Lord Mottistone—the clock will have already started ticking, because it starts ticking the moment a direction is made. Surely the pressure upon professional advisers and their clients to present a planning application within a very short time, with little leeway for negotiation, would be very great.

I can also see adminstrative difficulties for the local planning authority having to process what might be a flood of applications in a very short time. The financial effects of this Bill are said to remove potential financial liabilities from local authorities. I think that this would do just the opposite, at any rate for a short and hectic period.

As I said, and as I see it, the imposition of blanket Article 4 directions for an indefinite period upon many areas of agricultural land may become an attractive propositon for local authorities because of the reduction of their liability to pay compensation, and the effect of this could lead to a stultification of the improvement of land in the future. Here I refer to something that the noble Baroness said. Whatever the arguments surrounding the immensely wide issue of restraints upon agricultural production, if Parliament wishes to see further controls over agricultural operations that surely should be done by the legislative process after consultation, and not through the back door by means of administrative directions.

Another objection is that the way that local planning authorities could make use of Article 4 directions might run counter to the spirit and to the operation of management agreements under Section 39 of the Wildlife and Countryside Act. Blanket Article 4 directions might remain on land for a considerable time, and, compensation having been reduced to a once-and-for-all claim, there would be little or no incentive for local planning authorities to become involved in serious negotiations towards offering sensible and acceptable management agreements. It would be felt that the conservation objective would be achieved through the planning route with little or no liability for compensation. But if it is thought necessary to alter the Wildlife and Countryside Act, in so far as Section 39 and compenation arrangements are concerned, then this Bill does not seem to me to be a suitable vehicle for doing so.

Surely the purpose of this Bill is twofold. First, the Government may well be amending the GDO at some point this year, which in turn could give rise to liability for compensation in perpetuity. As I understand it, the purpose of Clause 1 in the Bill is to curb what would otherwise be an open-ended situation. Secondly, Clause 1(2) is designed to discourage greedy, if not bogus, claims in the urban scene. Clearly this Bill should not be the vehicle for far-reaching amendments of the Town and Country Planning Act 1971. I very much hope that the Government will resist these amendments.

Lord Sandford

As one of the Peers who has his name to this amendment I wonder whether I may now be allowed to come in and then perhaps the farmers can carry on. I rise first of all to support the two noble Lords whose names are also to the amendment, in urging on the Government the need to include, in some way, the Article 4 directions which are also involved in bringing under control the abuses which this Bill is designed to deal with. Speaking for myself I have no intention today, in any of the amendments that I have put down or on which I intend to speak in support, of doing anything other than to probe the Government's intentions and opinions on what is before us. So, as far as I can detect, there is no danger of any of these amendments being pressed. We do not want to get too excited quite yet.

I join with the noble Viscount, Lord Craigavon, and the noble Viscount, Lord Dilhorne, in thinking that it might be useful to include in what we are saying now matters which refer to not only Amendments Nos. 2, 7 and 9, but also Amendments Nos. 4 and 8, and to make the point that this amendment also paves the way for Amendment No. 20, which refers to conservation areas, which also require Article 4 directions to control what goes on there.

Amendment No. 8: Page 1, line 17, at end insert ("or the date on which the direction was confirmed.").

Amendment No. 20: Page 2, line 8, at end insert— ("(6B) For the purposes of subsection (1) of this section paragraph 3 of Schedule 8 to this Act shall be construed as not extended to the enlargement of a building which was in existence on the appointed day if the building is a listed building or is in a conservation area.".").

It is certainly true that Article 4 directions would be needed if we sought to control by means of this Bill developments in the countryside that are not subject to planning control. I have put down Amendments Nos. 11 and 12 not actually to delete Section 169 but to find out what are the Government's reasons for wanting to retain it. I have no doubt that they have very good ones. I also wanted to give to the Committee the opportunity to discuss the way in which we deal with these matters in the rural areas.

It might help if at this moment I say that it would not be my view that we should bring farming, agriculture, forestry or any of those matters under planning control. This is something that the Countryside Commission recommended a few months ago and which even a working party of the CLA recommended as recently as November. I am not recommending that. But there are procedures for dealing with these matters in the countryside, about which my honourable friend Mr. Waldegrave wrote to the Countryside Commission at the end of January and which were published in Hansard on 31st January.

I think that this is highly relevant to what we are discussing. In my view it would be useful to have a word from the Minister—and I have given him notice of this—as to how that code will operate, in order to allay our misgivings about what might happen if this code is brought into effect to deal with threats to amenity in the countryside. I hope that my making those preliminary points has been helpful to the Committee.

Finally, I am one of the noble Lords who has an asterisk printed beside one of his amendments, in this case Amendment No. 10.

Amendment No. 10: Page 1, line 17, at end insert— ("( ) In section 167 of that Act (contribution by Secretary of State towards compensation in certain cases)—

1. (a) in subsection (1) after the words "The Secretary of State may" there shall be insertsed the words "and in the case hereinafter provided shall"; and
2. (b) in subsection (2)(a) after the words "local planning authority" there shall be inserted the words "and shall consist of the amount of compensation to be paid in any case in which the entitlement arises under section 165 of this Act, and that entitlement still subsists following the Secretary of State determining an appeal against refusal of planning permission or conditional grant of planning permission.".").

All I shall say in defence of that is that, although it may be a surprise to the noble Lords, Lord Sandys and Lord Mottistone, this is an issue on which the ADC has been in correspondence with the Department of the Environment since March 1984. All that I was seeking to do, which caused the delay, was to respond to what my noble friend on the Front Bench had said at Second Reading. I beg the Committee's forgiveness for having introduced the amendment at a late stage.

The Earl of Radnor

I, too, should very briefly like to say that I could not possibly be happy with this series of amendments. There is nothing more that I can add to what my noble friend Lord Middleton has said, because I think he put the question very well indeed. I must admit that I am not even entirely happy with the urban situation. I have just put it out as a thought that to argue it from the particular of The Boltons to the whole urban scene is arguing for a rather special set of circumstances, and ones that might be quite different.

I think the only point that has not been mentioned so far is to do with farmers in Wales and Scotland, as mentioned by the noble Lord, Lord Mackie of Benshie, and indeed perhaps also farmers in England—who move a little slower, not because they are slow-minded, but perhaps because of the slowness of the seasons—and the relationship of the Government, the Countryside Commission and so on to the whole question of the environment. If the environmental business is brought into this Bill, which was, as many noble Lords have said, to deal with very particular circumstances, the farmers of the British Isles would very properly feel that it was a rather crafty move on the part of Parliament and they would bear resentment. Today, in a climate when the relationship between urban people, environmentalists and farmers is improving, that would be a great pity. So on that count, and perhaps on others, I must admit to being against this series of amendments.

The Earl of Avon

As I imagine that the noble Baroness may wish to keep her powder dry for the next amendment perhaps I may speak now. As my noble friends have explained, this amendment relates to situations where a permission granted by the general development order has been withdrawn by means of a direction made under Article 4 of that order. At first sight this is a logical extension of the provisions of the Bill relating to compensation after the revocation or modification of a development order. However, when we were framing the Bill we deliberately decided not to extend its provisions to Article 4 directions.

Let me explain this. There are two reasons. First, as I mentioned on Second Reading, an Article 4 direction is normally made to control specific development, the planning of which is already under way. In such cases the landowner will have incurred expenditure in reliance on his GDO rights and be ought to be entitled to compensation if these rights are suddenly taken away in the middle of the process. He would, of course, continue to be protected by the 12-month period, but there seemed to us to be a little point in placing any limitation on compensation claims in these circumstances.

However, there is another, and more fundamental, point. When a development order is revoked or modified the initiative comes from the Secretary of State, and his actions are subject to parliamentary control through the negative resolution procedure. An Article 4 direction is made by the local planning authority and confirmed by the Secretary of State without any parliamentary procedure. At present the Compensation Provisions Act has a brake against the excessive use of these powers. It also mitigates the discriminatory effect of such directions as between one landowner and another. It may be reasonable to impose greater control on a particular owner, or on landowners in a particular area, but the right to compensation means that such landowners are not unfairly treated by comparison with those who can still take full advantage of their GDO rights.

The effect of the noble Lord's Amendment No. 9 would be to remove all rights to compensation under Section 165 of the Town and Country Planning Act in relation to the withdrawal of planning permission for the development of residential land granted by a development order. I am not sure that this is what is intended. Certainly, we would regard it as unreasonable so to do. We shall be returning to this point on a later amendment. I suspect that the intention is to limit the right to compensation when such rights are withdrawn by means of an Article 4 direction. I am bound to say that I can see no justification for discriminating against "residential" in this way. If the provisions of the Bill are to be extended to Article 4 directions, surely this should apply to all such directions. We should treat urban and rural land owners or indeed owners of houses and offices in the same way.

4 p.m.

I recognise the fear that once a compensation constraint is removed or at least limited, a flood of Article 4 directions will be submitted. They will of course still need to be confirmed by the Secretary of State. Nevertheless the Committee has to recognise that this would be an important shift in the balance between planning authorities, land owners and conservationists. As such, it should be the subject of proper consultation and discussion coupled with a full examination of the likely effects. The Bill was not intended to go into this area and there has not been an opportunity for the full consideration of this far-reaching amendment. I am grateful to the noble Viscount, Lord Craigavon, and also to my noble friends Lord Dilhorne and Lord Sandford for raising some important issues. I hope that they will accept that it would be inappropriate to attempt to resolve them in the context of this limited and technical Bill.

Lord Sandford

Before the noble Viscount, Lord Craigavon, decides how to respond, may I make one point to my noble friend on the Front Bench? My noble friend said quite rightly that Article 4 directions are generally introduced in order to control a particular individual threat by some developer or land owner. That is indeed the case. But that is not the only kind of Article 4 direction. They are sometimes—this is the most important category for our purpose today—introduced in order to support the application design guides in urban conservation areas or in order to deal with a general threat to the character of some rural area. When the Secretary of State has it in mind to confirm an Article 4 direction of that category, the case argued by the noble Viscount, Lord Craigavon, has rather different and greater merit. I wonder whether my noble friend would undertake to look at this to see whether there is a way of extending the Bill now before us to catch this particular category of Article 4 directions. I accept entirely the force of his argument about Article 4 directions of a more specific kind.

The Earl of Avon

I happily undertake to look into this for my noble friend.

Viscount Craigavon

I am grateful to the noble Lord, Lord Sandford, for his intervention. I go along certainly with what he says. I am also grateful to the Minister for the manner in which he has replied to the debate. What has been brought home to me is the difference between agricultural and urban problems. The sheer scale of the compensation in relation to the urban problem is a matter of urgency. The noble Lord, Lord Middleton, says that we should take our time and have full discussions. The trouble is that in urban areas—I gave examples—the clock is ticking and large amounts of potential compensation are being built up. I would say to the noble Earl, Lord Radnor, that I was giving specific concrete examples to make my case. I was not saying that they were typical of the whole urban problem.

The urban problem is emphasised in areas of high land values. That is why I chose the example of The Boltons. I appreciate what the Minister said about the problems of Article 4 directions so far as residential land is concerned. I should like to read his speech and then decide what action to take at the next stage of the Bill. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 3 not moved.]

Baroness Birk moved Amendment No. 4:

[Printed earlier: col. 1217.]

The noble Baroness said: This is really the same amendment as that already proposed by the noble Viscount, Lord Craigavon. The noble Viscount spoke lucidly and explained it very well. I shall not therefore delay your Lordships for long. I was extremely disappointed to hear the Minister's reply. Article 4 directions are extremely important. How they affect listed buildings and buildings in a conservation area—this is an important aspect—is of great concern to the Historic Buildings and Monuments Commission. The noble Lord, Lord Montagu of Beaulieu, if he had been able to be present this afternoon, would either have been moving the amendment with my support or would have given his support to me.

I would go further. What strikes me as being a great pity is that the fears expressed on the agricultural side have been rather exaggerated. I am aware that Article 4 directions appy to other areas. I am particularly concerned, like the commission—the noble Lord, Lord Sandford, referred to this—about the effect on buildings in conservation areas. A building that may not necessarily be listed itself but which is situated in a conservation area can be affected by some hideous addition to the attractive architecture of a particular building. The whole area is affected. Change can be prevented if an Article 4 direction is in force because planning permission will have to be sought. However, we come back again to the claim for compensation. As the Government have recognised that the possibility of compensation—a claim can last into perpetuity—is indefensible if it results from a development order, they should surely recognise that it is indefensible if it results from the imposition of an Article 4 order. It cannot be right for the local planning authority to be constrained for ever in exercising that protection through fear of claims for compensation.

I would add one further point which I hope the Minister will take back and ponder over. At the time that the Historic Buildings and Monuments Commission was detached from the Department of the Environment, there was a great deal of discussion about it. The Bill came first to this House, where I dealt with it from these Benches. I had discussions at the time with the then Secretary of State Mr. Tom King about the effect of this amputation from the department. My feeling, as I had been concerned with this area as a Minister in the last Labour Government, was that the only raison d'être for this step was that it would operate better as a separate entity rather than remain within the DoE. This was generally understood all round.

I do not believe for one moment that if the commission had been part of the DoE today this Bill would have progressed so far as it has without someone saying. "For goodness' sake remember how it will affect the conservation areas." I would take almost any bet that this would have been taken into account in the Bill. But the commission did not know anything about it. It was not alerted. It did not know. That is a very unfortunate occurrence. Unless some change is made, conservation areas will suffer. And this has happened because the commission is separate. I do not think that it was ever intended that there would be this lack of communication. It is very difficult. I am not pinning the blame on anyone, certainly not the Minister. When these things are under one roof, they are known about. It is known that there is going to be another Town and Country Planning Bill, and anybody who has an interest which relates to the department makes his case. This will go by default unless the Minister takes it back—I hope he will; I think he said he will do so—and looks at it again in the light of all the circumstances and what has happened.

I think that enough has been said on the other amendments which have been moved. Amendment No. 8 is really almost an alternative to Amendment No. 7, which the noble Viscount, Lord Craigavon, has already discussed. Again, this deals with the date on which the direction was confirmed. I do not think there is very much more I want to say on that. To us, the amendments are interchangeable. If eventually Amendment No. 7 were accepted, we should be very happy. If Amendment No. 8 were accepted, I think noble Lords who have put their names to Amendment No. 7 should be equally happy.

The Earl of Avon

As the noble Baroness says, we have already dealt with a lot of this. This amendment raises some fundamental issues which require considerable thought, and it is perhaps unfortunate that we are being asked to decide them without any opportunity for widespread consultation or public debate. I know—and, indeed, we have heard—that the farming community in particular is deeply concerned that the amendments, if adopted, would encourage the widespread use of Article 4 directions to control agricultural development in sensitive areas, so circumventing the need for compensation to be paid under the provisions of the Wildlife and Countryside Act.

The safeguard is of course the need for the Secretary of State to confirm in Article 4 directions that that links the right to compensation. This, I believe, could lead to the submission of many more directions than are made at the present time; and that, again, would create confusion and uncertainty. It has been suggested that if directions were confirmed they could provoke a large number of applications from landowners who rightly or wrongly felt aggrieved and who were determined to get their pound of flesh from a planning authority during the 12-month period in which compensation was still available. I regard many of these arguments as ill-founded, and I regard the requirement to seek confirmation of a direction as an important control. I am confident that the Secretary of State can be relied on to exercise his powers in a responsible manner.

It could be argued that the present compensation provisions go beyond what is needed to protect the legitimate interests of the landowner, and in effect make it virtually impossible for planning authorities to bring permitted development under control in areas where it is clearly necessary to do so, even if the environmental quality of the area is to be maintained. Nevertheless, I have to recognise that this would be an important shift in the balance between planning authorities, landowners and conservationists. As such, it ought to be the subject of proper consultation and discussion.

The noble Baroness will have read my Second Reading speech, in which I was able at the time to give some hope to the conservationists. However, I have to tell her that in the interim we have had quite a talk with the other departments within government, and as a result I am not holding out quite as much hope as I did.

4.15 p.m.

Baroness Birk

I wondered what had happened. I thought for a moment that the Minister was perhaps speaking to a different amendment from the one that I moved. Unfortunately, he is only too right: what he is now saying is very different from what he said on Second Reading. This afternoon we are probing and finding out what the Government feel. As the noble Lord, Lord Sandford, said a few moments ago in regard to his amendments, I do not intend to press any of my amendments today.

This matter is of great importance. On Second Reading we considered the general principles, but now we have amendments before us. I hope the Minister will reconsider this and go into it again. There is time for him to do so between now and the Report stage. He said there had not been enough consultation. I should like to feel that the Government did a certain amount of consulting, but evidently they did not. If they had, we should not have had the situation that the commission knew nothing about this. That is one example. In regard to a small Bill like this, and something that has been hanging over for a long time, I should have thought that the amount of consultation needed to bring one up to date would not have been enormously great or very lengthy.

In the circumstances, I certainly cannot press this today. I say that mainly because I do not think I should win today. I should like the Minister to take it back and ponder seriously on this point about the locus and status of the commission now that it is not part of the DoE. This is a fundamental point. It is bound to arise again and I think it should be sorted out on this level and on this amendment. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Lloyd of Kilgerran moved Amendment No. 5: Page 1, line 15, after second ("or) insert ("36 months in the case of agricultural land but otherwise").

The noble Lord said: The purpose of my amendment is to extend the time limit of 12 months which is in the Bill. It is a time limit in regard to any GDO changes in applications for compensation arising from the refusal of planning consent in circumstances where planning permission was not previously required. The amendment is confined to extending that time limit of one year to three years-36 months—in the case of agricultural land.

My task in moving this amendment has been simplified by the number of speeches made from all parts of the Committee indicating that the circumstances arising in planning arrangements and in GDO orders in relation to agricultural land are different from the conditions in developments in urban situations, to which this Bill is mainly directed. Indeed, the noble Viscount, Lord Dilhorne, in supporting one of the amendments of the noble Baroness, Lady Birk, said that possibly there were, in relation to developments and planning permission for agricultural land, difficulties which would require greater sympathy.

In the case of agriculture farm investment, decisions are often not for isolated, one-off developments but are part of a sequence of developments involving both operations on the land and buildings. Indeed, the Ministry of Agriculture specifically encourages such a planned approval through its agriculture and horticulture development scheme. On Second Reading I indicated that, particularly in areas in Wales that I know so well, there are rapid developments in the pattern of farming. Dairy farming is being replaced by sheep farming, and in some areas even sheep farming is gradually being replaced by horse breeding. Therefore, the period of one year, in the circumstances of the planning operations and the pattern of farming, is too short. I suggest that 36 months would be more suitable than that period of one year. I beg to move.

The Earl of Avon

The noble Lord, Lord Lloyd of Kilgerran, has ably argued the case for treating agricultural development differently from other development for the purposes of the time limit which the Bill introduces on the compensation entitlement in Section 165 of the Town and Country Planning act 1971.

The amendments raise two issues. First, is the 12-month period proposed in the Bill long enough? That is also a question raised by the amendments proposed by my noble friend Lord Mottistone which we shall be discussing later. When we were considering amendment of the compensation provision in Section 165, our purpose was to ensure that the limitation of the right to compensation where a development order permission is withdrawn did not affect a landowner who has incurred expenditure in reliance on that permission and who will suffer a real loss as a result of the withdrawal. We therefore considered very carefully whether it was possible to require a claimant to prove that the losses for which he was claiming were directly attributable to the withdrawal of permission. Unfortunately, we found that any such test was impracticable. We concluded that a much simpler and more effective way of restricting the entitlement under Section 165 to those for whom it is intended is to impose a time limit. In our view it will be most unusual for a landowner who has already spent money on a proposed development not to be able to put in a planning application within a year of the withdrawal of development order permission on which he was relying. Any longer period than a year would, on the other hand, be open to abuse.

That brings me to the second issue which the amendments of the noble Lord, Lord Lloyd of Kilgerran, have raised. He argued that while the one year period of grace is sensible in most cases, farmers have a special need because the lead times in their industry tend to be well over 12 months. I fully accept that that may be the case, and indeed recognise that similar circumstances may arise in other industries, such as mineral extraction. However, I do not think that it is possible to identify those changes to the General Development Order which might be made at some time in the future and which might affect developments with long lead times. I am certain that not all developments on agricultural land, which is what the noble Lord's amendment would catch, are in that category. In any event, it is misleading to consider only the 12 months. General Development Order amendments are generally made after a lengthy consultation period, which means that landowners will have advance warning of impending changes.

Furthermore, although the landowner will have to make his application within 12 months, he can plan ahead for a much longer period than that: if planning permission is given on his application he will have a further five-year period for commencement of the actual works. This consideration is clearly of importance where a farmer is working on a scheme of development extending over several years.

Finally, where a proposed amendment to the General Development Order directly affects industries such as agriculture, which have long lead times for development, so that a longer warning period is desirable, we can deal with the problem by providing a longer than usual period between the date when the order making the amendment is laid before Parliament and the date on which it comes into force.

In point of fact that was done in the case of the hazardous development order last year. However, so far as the period of grace for claiming compensation is concerned, once an amendment to the General Development Order has come into force, any period longer than one year gives rise to opportunities for abuse. I look forward to the noble Lord's acceptance of my reasoning.

Lord Lloyd of Kilgerran

With great respect to the noble Earl the Minister, the first part of his speech did not seem to me to be relevant to the amendment which I was moving. As regards this amendment, I am only concerned with the time limit in relation to agricultural arrangements or planning permissions dealing with agricultural matters.

During the second part of the noble Earl's argument he said quite definitely that no trouble will arise as regards this provision—farmers will be able to carry this out quite easily in a year. Without disrespect to the noble Earl, I am tempted to say that to deal with my amendment in that type of way is to deal with it from an ivory tower. Regarding agricultural problems, there have been no consultations whatever. This commenced life as a relatively minor and technical piece of legislation to deal with an urban abuse, an urban problem, and I agree with that part of the Bill which deals with that matter. There was a specific abuse as to the present compensation arrangements. However, now this simple Bill has raised complex and more far-reaching issues upon which there has been no widespread consultation with interested bodies. If I understood the noble Earl the Minister correctly in one of the speeches which he made earlier this afternoon, he indicated that there had not been that wide consultation which perhaps the wider implications of this Bill would require. I notice that the noble Baroness, Lady Birk, is nodding her head in agreement with me.

Therefore, in view of the very sympathetic speeches which we have heard this afternoon from the noble Lord, Lord Middleton, and in part from the noble Viscount, Lord Dilhorne, about the special problems of agriculture, I ask the noble Earl whether he would not think it fair to the agricultural community to take back this amendment and think about it again in the context of agricultural planning.

The Earl of Avon

I should be happy to give the noble Lord, Lord Lloyd of Kilgerran, that undertaking. Perhaps I could ask him to consult with his own lobby?

Lord Lloyd of Kilgerran

I am very grateful to the noble Earl for giving that undertaking and in the circumstances I have no alternative but to beg leave to withdraw the amendment at this stage.

Amendment, by leave, withdrawn.

Lord Mottistone moved Amendment No. 6: Page 1, line 15, leave out ("twelve months") and insert ("five years").

The noble Lord said: With the agreement of the Committee, I propose to move Amendment No. 6 and to speak also to Amendment No. 21.

Amendment No. 21: Page 2, line 19, leave out ("twelve months") and insert ("five years").

I must inform the Committee that I am advised by the CBI on these matters and I am particularly concerned with the implications of this Bill for industry. Like other noble Lords, I feel that it has been designed to deal with a particular type of problem in urban areas, which perhaps has not allowed the Government to give enough thought to its wider implications. On the whole, my noble friends on the Front Bench are extremely keen to promote business enterprise and to make it easy for businesses to prosper. However, in this particular case perhaps they have overlooked the need to modify the Bill to permit business to receive fair treatment under it.

The General Development Order of 1977, with the earlier general orders of 1973 and 1974 which it replaced, has been a vital part of the planning system in this country ever since the comprehensive legislation of 1971. Without its provisions the whole system would long ago have ground to a halt. What the Government appear not to recognise in the context of this Bill is the extent to which industrial and other investment depends on the reasonable expectation of being able readily to expand successful projects and introduce new methods. Rarely can an accurate forecast he made of the extensions and improvements that a project will require even in a year or two if it is to remain competitive.

The second and related factor is the benefit to an enterprise of being able to make environmentally insignificant changes without the need to go through all the rigmarole of securing a fresh planning permission. To illustrate what I am talking about, I propose to quote one example: the updating of a chalk processing plant at Beverley. I noted that my noble friend Lord Avon in his answer to the last amendment indicated that he realised that mineral undertakings did perhaps deserve to be treated as a special case. I may have misunderstood my noble friend, and he can tell me if that is so when he comes to reply.

In the particular case to which I am referring the company concerned wished to improve and expand its plant. The local planning authority agreed in principle that the proposals fell within Class 19 of the General Development Order—that is, the class relating to development by mineral undertakings.

4.30 p.m.

During discussions about the development, plans were amended to take account of changes in the market occurring during the preparation of the scheme. From initial discussion to submission of the final plan took two-and-half years. The local planning authority gave its approval, and Beverley now has an improved and appropriate plant. This timescale is not unusual for industrial developments falling within the scope of the present GDO. I would add that there had been no planning application, no public inquiry: in short, no opportunity for the obstruction which so often greets a planning application.

At Second Reading my noble friend the Minister said that it was inconceivable that a landowner should not hear within 12 months of a change in GDO rights which took away permission relevant to the scheme he had in hand. I think that my noble friend will probably realise from what my noble friend Lord Middleton had to say that this really is not fair in the countryside. Landowners affected by a change of this sort often do not learn of its existence until some time after its operation, and any imposition of a time limit so far as a liability for compensation is concerned could be highly inequitable and gravely prejudicial to the landowner since, as was stated by my noble friend and was appreciated by the noble Viscount, Lord Craigavon, the clock may have been ticking away for months before the fact is discovered. That is the landowning aspect of this, which shows that the one year is too short.

Further, I think that my noble friend probably over estimates the ability of small businessmen to keep abreast of the planning law, in the same way as difficulty is experienced by people in the countryside or even by a planning expert in a larger company to know of every gleam in the eye of every site manager or sales manager in his company. Furthermore, only at a fairly late stage of planning many developments will it be ascertainable whether they can be carried out within the scope of the GDO.

It is for those reasons, and for the example I gave, that I recommend that this one-year figure be changed to five years. I would not be absolutely rigid on that. I think that the three-year period which has been proposed for agriculture only by the noble Lord, Lord Lloyd of Kilgerran, would not be enough for business because of the example I gave of two-and-a-half years in what you might call easy circumstances. I would hope that the noble Lord, Lord Lloyd of Kilgerran, would agree that business has just as much of a need for these special rules as does agriculture.

I would therefore suggest that the Government might give serious thought to some way of dealing with these problems, which do not concern urban property developers but would concern the people of this country who are earning the money to keep the country alive. Could my noble friend give some favourable thought to some way in which this Bill could be amended either in the way I suggest or in a way which achieves the same result? I beg to move.

Lord Lloyd of Kilgerran

I should like to support the noble Lord, Lord Mottistone, in the general theme of the speech he has made to your Lordships this afternoon. If he had been present at Second Reading—and I know that he was unavoidably detained then, so I make no complaint—he would have heard that I supported that general theme. I said that so far as farming and small businesses were concerned, this limited period of one year was far too short.

I went a little further in the scope of what I said than the noble Lord, Lord Mottistone, did just now. I submitted that a much longer period should be adopted in dealing with parts of another class of GDO orders; that is to say. Class 8, which is entitled "Development for Industrial Purposes", and which goes a little wider, even, than that which the noble Lord, Lord Mottistone, spoke about today.

I also raised the question of Class 3, which relates to changes of use particularly with application to shop premises, and also of Class 4 of the GDOs, which is related to temporary buildings, and said that where these were concerned with planning applications involving farming and small businesses a longer period than one year was desirable.

The Earl of Avon

The noble Lord, Lord Mottistone, took my words somewhat out of context. I was giving examples of the dangers of generalising when I mentioned mineral workings. However, the provision of a five-year period for applications to be made after a development order amendment without loss of compensation rights would simply be an invitation to unscrupulous landowners to work up and submit applications which do not relate to genuine development proposals but are primarily intended to obtain compensation. The basis of this Bill is that compensation should be paid only when the landowner had begun to incur expenditure on the basis of the development order permission before it was taken away, and, in nearly all circumstances, it seems reasonable to expect such a landowner to be able to put in his planning application within 12 months.

It should be noted that there is a difference between a right to compensation and a right to planning permission. This Bill does not take away any permission granted by a development order. It simply regulates the compensation position when such a change is made.

It should be remembered that, if permission is then given, the actual work does not have to be carried out for five years. It should also be remembered that an amendment to a development order is often preceded by a consultation period, which provides advance warning of what is likely to happen. If there are one or two classes of development, with a particularly long lead time, when a longer warning period is required, the problem can best be dealt with by providing a longer than usual period between the date when the revocation or amendment order is laid before Parliament and the date when it comes into operation. The provision of a five-year period across the board would be likely to undo much of the effect of this part of the Bill because of the possibilities that it would provide for abuse. I hope that now that this possibility of abuse has been drawn to my noble friend's attention he will at any rate wish to reconsider his amendment.

Lord Mottistone

May I take up two points? I agree that if landowners are going to abuse the system this is the whole point of the Bill, and I do not think that any of your Lordships' Committee would quarrel with that as a basis. However, may I suggest to my noble friend that perhaps he was not shooting his guns strictly at me in my amendment but rather at somebody else's amendment. Perhaps when he cares to look at it he may find that there are things which I have said which require careful answering.

I think my noble friend said—and he said this also in answer to the noble Lord, Lord Lloyd of Kilgerran—that a longer time could be left between the laying of an order and its introduction in special cases where this would appear to be necessary. There is nothing in the Bill or anywhere else to say that this is going to happen. If that is an answer, one needs to have something laid down somewhere in legislation. Whether it be in an order, in primary legislation or in guidelines, I do not mind, but something is needed which gives reassurance of that sort. If we could have that sort of reassurance it might be that the worry that I have of business people being unfairly overtaken by events would be set at rest.

I would be grateful if my noble friend would undertake to look carefully at what I have said, and I shall of course read carefully what he has said, with a view, at the next stage of the Bill, to perhaps coming to an agreement on some suitable amendment which deals with the problem.

The Earl of Avon

Of course I shall do that.

Lord Mottistone

With that undertaking, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 7, 8 and 9 not moved.]

Lord Sandford moved Amendment No. 10:

[Printed earlier: col. 1222.]

The noble Lord said: I beg to move Amendment No. 10. This is the last item on which I had something to say on Second Reading, where I sought to make the point to my noble friend on the Front Bench that, in a Bill which seeks to adjust the way in which compensation is paid in these various circumstances, it is also necessary to look at Section 167 and to make sure that the liability to pay compensation comes where it should logically and reasonably fall.

In dealing with that point when winding up the debate my noble friend was somewhat dismissive, as if saying that to suggest that the Secretary of State should have to make the contribution in any circumstances was being rather outrageous. But in fact Section 167 of the Town and Country Planning Act 1971 is headed: Contribution by Secretary of State towards compensation in certain cases". I do not want my noble friend to reply in any detail now unless he wishes to do so, but this amendment is really to respond a little to his remarks and to carry on the correspondence that there has been between the Association of District Councils and the DoE over the last year. The ADC are very concerned that Section 167 of the Town and Country Planning Act is amended to correspond with the changes now being made in the compensation code as a result of this Bill. This is all the more necessary when local authorities are now under much tighter control, with grant-related expenditure assessments, targets and so on. I beg to move.

Baroness Birk

I should like to support the noble Lord in this amendment. If it is to be effective it means that eventually the Government will accept either my Amendments Nos. 1 and 3 or some form of them. While I cannot see the Government centrally accepting the cost of paying the compensation, the noble Lord, Lord Sandford, is absolutely right when he talks about the financial restrictions on local authorities today. In addition to everything else it will be a very grievous problem for them. Therefore, the cleanest, simplest and best answer to this whole problem is to get rid of the compensation.

The Earl of Avon

As my noble friend Lord Sandford has explained, the purpose of this amendment is to ensure that, where the Secretary of State upholds on appeal a refusal of planning permission which gives rise to an entitlement to compensation, he should meet that cost. I do not see why this particular burden should fall on the Secretary of State. It is a general rule that compensation for planning decisions is payable by the local planning authority. The fact that compensation may be payable is clearly a matter which local planning authorities take into account when considering a planning application, and I appreciate the argument that local planning authorities are reluctant to use powers where a compensation liability may arise, even though, as was the case with the hazardous development order, it is highly desirable for them to have those powers. That, of course, is a main reason for the proposal in the Bill to restrict the compensation liability under this section.

However, there are many different circumstances in planning legislation where compensation liabilities may arise when adverse decisions are made. With his powers of appeal and call-in, the Secretary of State may make the decision in many such cases. It would surely be anomalous to single out cases of this type arising under this provision for special treatment. I am conscious that my noble friend Lord Sandford asked me about the Landscape Areas Special Development Orders. With the leave of the Committee, I should like to comment on these now.

4.45 p.m.

Lord Sandford

Perhaps I may interrupt my noble friend. I had no intention of introducing this rather extensive topic under this amendment, but, as I said earlier, I intend to do so under the next two amendments.

The Earl of Avon

I am grateful to my noble friend, and I shall be quiet.

Lord Sandford

To respond to what my noble friend said about Amendment No. 10, I think that perhaps he and I may have to have some further discussion between now and the next stage. I hear what he has to say. I do not think that he is going as far as he reasonably could to meet the point which my amendment makes. However, at this stage I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Sandford moved Amendment No. 11: Page 1, line 18, leave out ("In").

The noble Lord said: I beg to move Amendment No. 11 and at the same time speak to Amendment No. 12.

Amendment No. 12: Page 1, line 20, leave out from beginning to end of subsection (2) and insert ("shall cease to have effect.").

In speaking to these amendments, I seek to do two things. First, in moving to delete the effect of Section 169, I wanted to invite my noble friend to let the Committee know what justifications he thinks there are for retaining any longer some of the anachronistic matters that are contained in Schedule 8 to the Act. However, if the Committee would allow me, I also want to take a little time to say something about the effects of all this in the rural areas. In doing so, I want to welcome very much the initiative which is contained in the letter which my honourable friend Mr. Waldegrave sent to the chairman of the Countryside Commission, which was published in the Commons Hansard of 31st January. I refer especially to col. 286 of Commons Hansard. This is the extension and application of the development order known as the Landscape Areas Special Development Order. It is highly relevant to what we are discussing today because it provides a code of compensation and a code for controlling matters which in the case of farmers are not normally controlled by planning legislation in the rural areas.

I welcome this initiative and I should briefly like to describe what is involved for the benefit of the Members of the Committee who may not be entirely familiar with it. The original recommendations go hack some 12 years to the occasion on which I chaired the National Park Policies Review Committee which reviewed the way in which these matters could be handled in the national parks. If I may, I shall quote three paragraphs from our report—paragraphs 5.13, 5.14 and 5.15 on page 27. Paragraph 5.13 says: A special notification procedure in respect of farm buildings permitted under the General Development Order was introduced by the Town and Country Planning (Landscape Areas Special Developments) Order 1950"— may we note that that was 35 years ago— in three areas which fell roughly within those later designated as national parks. The procedure enables the planning authority to require an application to be made if they consider the proposed design or materials to be unsatisfactory, but leaves the farmer free to proceed after fourteen days if they do not. The Order applies throughout almost the whole of the Lake District National Park, the northern part of the Peak District and much of the Snowdonia National Park. It seemed to us strange and to reflect on the attitude of successive Governments to the national parks that the very limited application of this order should have endured for more than 20 years". It has, of course, now endured for 35 years. We went on: Farm buildings even of the size permitted under the General Development Order can have a considerable effect upon the landscapes of the national parks and we agree that it is undesirable that they are subject to no form of scrutiny. On the other hand we recognise that the removal of the general permission would be much resented"— and we have had ample indications of that already this afternoon. The notification procedure seems to us to strike the right balance between the interests concerned but we consider that its scope as well as its application is too limited. The siting of new farm buildings in relation to existing buildings, trees or other features may affect their impact upon the landscape just as much as design and materials. We appreciate that the Order in its present form affords the authority an opportunity to discuss siting with the farmer and that they have power, should the need arise, to make a direction which, subject to confirmation by the Secretary of State, would take away the permission granted by the General Development Order. That procedure, however, seems to us to be unnecessarily complicated and time wasting, and we consider that it would be preferable for the notification procedure to cover siting from the outset. We accordingly recommend that the scope of the Landscape Areas Special Development Order should be extended to cover siting as well as design and materials, and that the Order should be applied to the whole of every national park". That is what we recommended some 12 years ago; and three years after that the Government of the day, which by then was Labour, responded as follows in Circular 4/76. This is just one paragraph: As regards agricultural buildings the Secretaries of State agree with the Committee … that the scope of the Landscape Areas Special Development Order (LASDO)—which requires the agreement of the planning authority to be obtained to the design and external appearance of agricultural buildings which are within the GDO limits—should be extended to cover siting as well as design and materials; and that Order should be applied to the whole of every national park. They also accept the recommendation"— which I have not read— that in selected cases farmers should be assisted in meeting the extra costs incurred as a result of meeting the stringent design standards appropriate in the national parks. Compensation is already provided for in certain cases … but where it is not assistance could most appropriately be provided by enabling national park planning authorities to make discretionary grants under defined conditions. Legislation will be introduced for this purpose and payments made will qualify for inclusion in the annual estimates for national park supplementary grant". We had to wait for another five years after that and then compensation was made available in the Wildlife and Countryside Act—Section 44—so that for the last four years everything has been in place for this special order to be extended in the way we originally intended and recommended some 12 years ago. It is for that reason that I particularly welcome the intention expressed on behalf of the Government by my honourable friend Mr. Waldegrave, to press ahead, if that is the right term, after 35 years.

What I should like to do now, while we are considering the code of compensation in this Bill, is to ask my noble friend on the Front Bench to confirm that what our honourable friend Mr. Waldegrave said to the Countryside Commission is in fact being proceeded with, is being welcomed and pressed forward by the Ministry of Agriculture as well as by his own department. If he can assure us of that, then that sets to one side all the anxieties that have been expressed and that will otherwise no doubt continue to be expressed by those concerned as to the effect in the countryside of what we are trying to do on this Bill.

I gave my noble friend notice of my question and I have already been assured by my noble friend the Minister of State at the Ministry of Agriculture that all this was going forward satisfactorily. However, I think it would be useful at this stage for this Committee to have those assurances as well, and it would enable a wider public also to know that this is how compensation in these planning matters is going to be tackled in the countryside. I apologise to your Lordships for taking up a great deal of time, but I hope the Committee will feel that it is valuable to have it on the record. I beg to move.

The Earl of Avon

If I may, I will finish on the landscape development orders. As regards my noble friend's amendment, when considering the legislation that we should put before Parliament to deal with the Peaktop Properties decisions, we gave thought to the proposition that Section 169 should be repealed. We acknowledge it can be argued that the rights given by this section are not longer appropriate, but we consider that rights to compensation should not be taken away lightly and that Section 169 still plays a part in the value at which land changes hands. Moreover, apart from the matter of Penthouse Development, we are not aware that the entitlement to compensation under Section 169 is being abused. We therefore decided to make only a limited change in this Bill, designed to put right the known abuse.

The types of development referred to in Schedule 8 to the Act in relation to which compensation may be payable under Section 169 are quite varied. In addition to residential buildings, the schedule covers buildings used for agriculture or forestry, market gardens, nursery grounds, timber yards, the mining of minerals for agricultural purposes and the deposit of waste materials from the workings of minerals. My noble friend Lord Mottistone seemed to anticipate me there. It also covers the extension by up to 10 per cent. of any buildings, which may include offices, shops, factories and hotels.

Many of these classes of development are covered, of course, by the permission granted in the general development order, but a few arc not. These are well established rights and we cannot just take them away; but I can assure the Committee that we will consider carefully what has been said in this debate and certainly, if there is any evidence of abuse, we will consider the need to bring forward further proposals to prevent it.

I am told that what I can say on the Landscape Areas Special Development Order is that the question of the extension of this order is still under consideration. I am very happy that the Wildlife and Countryside Bill in 1981 made this possible, and I very much hope that it will soon come to fruition.

Lord Lloyd of Kilgerran

I am not sure what we are going to do about this amendment. May I ask the noble Earl, in regard to the interesting account we have heard of other legislation that is in being, how that will affect buildings in national parks? The noble Lord, Lord Sandford, mentioned national parks in the course of his speech, and I am wondering how all this legislation will affect buildings in national parks. It may be a question that it is difficult for the Minister or the noble Lord, Lord Sandford, to answer at this stage, but no doubt we shall get an answer at some point.

The Earl of Avon

I thought that the noble Lord, Lord Hunt, was about to get to his feet.

Lord Hunt

I was just listening, and hoping to learn.

Lord Sandford

I am grateful to my noble friend for what he said about Section 169. I hope I am right in detecting an assurance that further amendments will follow in due course. I think it is a pity that more advantage has not been taken of the opportunity provided here, because there really are a lot of anachronisms and oddities which make life very trying for the planning authorities. I thought what he said about the Landscape Areas Development Order was ominously evasive. Perhaps I may read very briefly from Hansard the letter that was quoted in another place on 31st January. My honourable friend Mr. Waldegrave said: I can, however, report a modest but significant step forward which we intend to take immediately."—[Col. 286.] Note, immediately. I should have thought that Members of the other place hearing that would have supposed that it indicated not that negotiations were going on between partners, but that agreement was already established. Indeed, my noble friend the Minister of State at the Ministry of Agriculture made it quite clear to me personally that this was being pressed ahead by both departments. It is something that we shall have to probe a little more thoroughly, because if it is not the case we are left handling these difficult problems without the admirable code about which 1 was just expatiating to the Committee. We have already had enough interventions from all over the Committee to indicate how very difficult it is to deal with these matters in any other way. At this stage, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 12 not moved.]

5 p.m.

Viscount Craigavon moved Amendment No. 13: Page 2, line 2, after ("day") insert ("—(i)").

The noble Viscount said: I beg to move Amendment No. 13, which is a paving amendment for Amendment No. 19.

Amendment No. 19: Page 2, line 8, at end insert ("; or (ii) if that building is used in whole or in part for retail trading purposes or as a restaurant or as offices or any other commercial purposes."."). The aim of these amendments is to remove from the possibility of compensation by right under Section 169 premises such as shops, restaurants and offices. This is particularly crucial in, for example, terraces of shops, sometimes with dwellings above them. What I am trying to say is that there is a problem here and now and that this Bill is the best place to deal with it.

If I may offer a specific example, there is a pizza restaurant very near where I live in Kensington. As is not uncommon, a small area in front of an establishment which is treated as public pavement in fact belongs to that establishment. The boundary is sometimes marked by a brass strip. This pizza place wishes to use its ability to expand by 10 per cent. by pushing its front forward. In this case, it would be in the form of a permanent structure of a depth of over 2 metres. The council are faced with the unpleasant choice either of having to allow it, and neighbouring shops, to extend similarly, though not in any way harmoniously, or of paying compensation in this case and having similar demands for compensation made by neighbouring shops, some of which have no real intention of such expansion but who would like the money. Word might easily get around that such compensation was readily available.

We do not want to see the ruin of a uniform and pleasant appearance of shopping terraces. It is easy to see that any such planning decisions could be detrimentally distorted by such considerations of compensation. These are not the criteria that it was ever intended should be used, and I am sure that property rights vested over 35 years ago were not intended to be used in this way. This amendment goes wider than just the example I have given, and I accept that it is difficult to frame the words of the amendment exactly to meet the wider intention. I feel that some action on these lines must be taken now in this Bill, or it will be just a matter of time before this area of planning procedure is discredited. I beg to move.

Viscount Dilhorne

I should again like to support the amendment of the noble Viscount, Lord Craigavon, almost identically word for word. The danger of allowing developments of the sort to which the noble Viscount referred can be seen very simply. By any promenade down any of the main streets in London one can see on the pavement marked, usually in front of shops, the extent to which those shops own the property that is trampled on by everyone every day. If applications are made to extend the front of properties to cover that land, the ragged effect on our terraces will be very damaging indeed. It is almost certain that in most cases planning authorities will want to say an absolute "No" to that.

I have found it very difficult in helping to draft the amendment. I wanted first to say, "trades, professions or vocations" but that would have fallen into the trap on which my noble friend has already commented, that it really would be too extensive and it would not work. So I have put the amendment in words which I hope will not go that far, but will eliminate the danger by describing specifically the sort of shops that would profit from this development. Fortunately, I do not think that this trespasses either on industry or on agriculture. I should like to support the amendment which the noble Viscount, Lord Craigavon, has just moved.

The Earl of Avon

I think that I have to resist this amendment. The abuse of Section 169 relates to extensions to blocks of flats. It does not relate to offices, it does not relate to shops and it does not relate to restaurants or other commercial premises. The only argument for extending the provisions of the Bill in this way is surely that Section 169 compensation rights are obsolete and, as I made clear in my Second Reading speech, and indeed on an earlier amendment, that is not what we believe. We could simply have proposed the repeal of Section 169 and Schedule 8 in their entirety. We did not do so because we believe that compensation rights should not be taken away without a very strong justification, and the only justification of which we are aware relates to blocks of flats.

We believe that it is important to maintain a proper balance between the interests of property owners and planning authorties. We are not in the business of confiscating established compensation rights which are not being abused. I hope that that will to some extent satisfy my noble friend Lord Dilhorne and the noble Viscount, Lord Craigavon. It is a difficult one and I am very sympathetic to their cause.

Baroness Birk

I should just like to support the noble Lords who moved the amendment, to which I also have my name. I can see that there is a problem here. Nevertheless, when we are looking at these planning procedures, even if this is supposed to be a short, small Bill, we ought to get the best out of it that we can, and a strong case has been made about the overshoot on pavements. But where I take issue with the Minister is when he talked about confiscating compensation rights. If we are going to alter compensation rights, which many of us want to do by the amendments moved today, there is no question of confiscating anything. We are just trying to see that they are either cancelled out or dispensed with. I do not think that the word "confiscated" is correct and in these circumstances it gives a wrong impression.

Lord Sandford

My noble friend spoke as though the Peaktop flat cases were the only abuse that we had to deal with, but I have here a whole schedule of hot food take-aways in York, completely bogus claims in the New Forest and the mushroom development, about which we have already heard, in the area of Lancaster City Council. There are strings of them. This is why we need to deal comprehensively with Section 169 cases. I do not want to go over the debate that we have just had on Amendment No. 11, but it is not satisfactory to say that the only issues that we have to deal with are these extensions to flats, because that is not the case.

Viscount Craigavon

May I thank the noble Lord, Lord Sandford, for that emphasis on the fact that there is a real problem in this area. It is not just this one pizza case but there are potential problems for whole terraces. Based on what the noble Baroness, Lady Birk, said, and also the noble Lord, Lord Sandford, I hope that between now and the next stage we might all get together to see whether progress can be made in that direction. But until then I should like to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Lloyd of Kilgerran moved Amendment No. 14: Page 2, line 3, leave out ("contains") and insert ("comprises").

The noble Lord said: As we have heard over and over again this afternoon, the mischief with which this Bill deals is the abuse of planning applications in relation to blocks of flats. The noble Earl the Minister emphasised this question of blocks of flats. Obviously there are many anachronisms in relation to town and country regulations and practices generally, and I of course would strongly support any Bill which will simplify planning applications and planning procedures. But this Bill deals with a particular abuse arising out of blocks of fiats.

Therefore, the purpose of my amendment is to define "building" in Clause 1(2). What kind of "building"? At the present time the Bill says, the building contains two or more separate dwellings". My amendment, which perhaps may smack of semantics but is a realistic amendment, substitutes "comprises" for "contains" so that what we are dealing with in this Bill is a building comprising two or more separate dwellings divided horizontally from one another". It would be helpful, in my view, to concentrate on the specific abuse in this Bill and allow the other abuses to be dealt with by separate legislation.

On Second Reading I raised as an example the difficulty which might arise in a school with which I am concerned, where the "building" comprises a complex of buildings all joined together. Part of the building consists of galleries—in fact, art galleries and dormitories—and two or more separate flats or dwellings, in which housemasters or curators of the museums are housed. Therefore, "building" in the context of this Bill as at present drafted would include not only flats but buildings which have attached to them these other kinds of buildings which may in themselves be listed buildings, as the art galleries are in the school with which I am concerned.

Therefore, the object of this amendment is to restrict the description of "building" with which this Bill is concerned, and the abuses on planning applications with which the Bill is concerned, to blocks of flats. Therefore it would be, the building comprises two or more separate dwellings". rather than, contains two or more separate dwellings".

I beg to move.

5.15 p.m.

The Earl of Avon

I was intrigued at Second Reading when the noble Lord referred to the school in the Isle of Wight. It is possible to postulate circumstances where this Bill would affect the noble Lord's school. They would involve the refusal of planning permission to enlarge by up to 10 per cent. a building in existence on 1st July 1948 which contained two or more flats. But I wonder whether this situation arises very often.

The circumstances in which this Bill takes away compensation rights are very narrow. I can see little justification for the noble Lord's amendment. I am by no means convinced that it would in fact really achieve what the noble Lord wishes, because it does not remove from the Bill the reference to the division of the flats from "some other part of the building". More important than that, however, is the fact that if the provision in the Bill were confined to buildings which contained only flats, this would create a considerable loophole: the existence in a block of flats of any other use at all, however small its extent, would allow the developer to claim compensation for an adverse planning decision. I hope the noble Lord will be satisfied with the explanation I have given. If by any chance he is not, I would be happy to write to him and try to explain further.

Lord Lloyd of Kilgerran

I am very grateful to the noble Earl for that reply. Do I understand from it that he may look at it again, or does he want me to initiate and ask him questions about it? Would he be willing to look again at the position where substantial parts of the complex buildings are not flats? I am personally concerned with a listed building to which again the public has access. The building is John Ruskin's home in the Lake District. We have to look after it. We have accommodation attached in a building which is a listed building. There is some anxiety among my colleagues and trustees as to what is the position of the building, which is in a National Park. If the noble Earl would like me to write to him, I shall do so. In any case, whatever happens, in view of the reply I have heard from the Minister, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Lloyd of Kilgerran moved Amendment No. 15: Page 2, line 4, after ("dwellings") insert ("or offices").

The noble Lord said: With the leave of the Committee, I should like to speak to Amendment No. 17.

Amendment No. 17: Page 2, line 7, after ("dwellings") insert ("or offices").

This amendment is intended to be helpful to the Government. I ask rhetorically the question whether the Government have limited their definition of "building" too much. The Government will know that some of us have heard about the problems relating to buildings comprising merely offices. We have heard so much about the abuse of planning arrangements where the building comprised at the appointed day in 1948 blocks of flats. Does not the same kind of abuse apply if that building was comprised merely of offices, certainly divided from one another in the way indicated in Clause 2?

It seems to me that a glaring abuse may have been omitted from the scope of the Bill in that not only is there an abuse of planning permission arising where the block building consists of fiats but maybe also where it consists entirely of offices which were in existence and had been built before 1948. I beg to move.

The Earl of Avon

Perhaps I may respond to the previous amendment of the noble Lord. The onus will be on me to write to him.

I am sorry that I cannot advise the Committee to accept this amendment. As I made clear on Second Reading, we have introduced this Bill to deal with the abuse of the compensation provisions of the 1971 Act in relation to applications to extend blocks of flats. We have, as I have said—rather repeatedly, I think, this afternoon—no evidence of similar abuse in the case of office extension. We know that property owners regard the right to compensation for such an extension as of considerable importance.

I recognise that some members of the Committee may feel that Section 169 and Schedule 8 are obsolete and would like to see them repealed in their entirety. But that is not what we are about and I cannot see any justification at the moment for picking out office block extensions for adverse treatment.

Lord Lloyd of Kilgerran

I am grateful to the noble Earl for his reply, which indicated of course that the Government are not aware of any abuses in relation to blocks comprised solely of offices. In those circumstances, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The Earl of Avon moved Amendment No. 16: Page 2, line 6, leave out from first ("in") to ("contained") in line 7 and insert ("either an increase in the number of such dwellings contained in the building or an increase of more than one-tenth in the cubic content of any such dwelling").

The noble Earl said: The purpose of this amendment is to block a potential loophole in the provisions relating to Section 169 and blocks of flats. It is the same point that is concerning my noble friends Lord Craigavon and Lord Dilhorne. The Bill as drafted covers the specific Peaktop abuse, by removing the right to compensation for adverse decisions on applications relating to blocks of flats which were in existence on 1st July 1948, where the extension would lead to the creation of additional flats.

It has been argued that it would be possible to get round this provision by applying for permission to add an additonal storey which would convert the top floor of flats into maisonettes, or which would involve other major extensions to existing flats. Although the effect in planning terms would be much the same as in the Peaktop case, compensation would still be payable because no additional flats are being created. We consider that the best way to deal with this problem is to provide that extensions which increase the size of any individual flat by more than 10 per cent. will not attract compensation under Section 169, and that is the effect of this amendment. I beg to move.

Viscount Craigavon

I am very grateful to the noble Earl the Minister for this amendment as well as to his department and the Secretary of State in another place. This is an important additional amendment to one of the major planks of the Bill and I am extremely grateful to the noble Earl for it. I will certainly be withdrawing my Amendment No. 18. I may say that the Royal Borough of Kensington and Chelsea and their advisers will also be grateful for this particular amendment.

Baroness Birk

I should also like to say how pleased I am to see this amendment on the Marshalled List in the name of the Minister. The only proviso I would add is that I hope it will be possible during the progress of this Bill to extend the horizons a little further. But this is a very good start—top marks!

On Question, amendment agreed to.

[Amendments Nos. 17, 18 and 19 not moved.]

Baroness Birk moved Amendment No. 20:

[Printed earler: col. 1221.]

The noble Baroness said: We come almost immediately to a very necessary extension of the kind for which I hoped that I had softened up the noble Earl the Minister a few moments ago. This amendment extends the withdrawal of the right to claim compensation under Section 169. Whereas the Bill proposes withdrawing the right only in respect of extra flats added to pre-1948 buildings, this amendment applies to all listed buildings and buildings in conservation areas.

The effect would be that local planning authorities will be able to refuse applications for either damaging or unsightly extensions to buildings in conservation areas without fear of having to pay compensation to the would-be developer. In view of the time and the business before us, there are just three points I want to make in attempting to convince the Minister that this amendment deals with a very special case. As he will have noticed, this amendment appears in the names of four Members of this Committee who are all very concerned with the subject—and the noble Lord, Lord Sandford, has considerable personal experience of it.

First, it would be tragic to waste an important opportunity to protect the heritage when that can be done quite simply in this Bill, since conservation areas represent so much that is loved in the English scene. It would be hard to imagine not only London but also many other cities throughout the country without those parts of their architecture such as elegant terraces and other features which all contribute a part to our quality of life.

Many of those buildings are not individually listable, but those within conservation areas—and many of them are—should not be put at risk by the failure to remove a damaging right to claim compensation. The Bill as it stands removes the right to claim compensation only if the building is in use as flats and if extra flats are to be added. From the point of view of a conservation area, the use is irrelevant.

There can be just as much damage caused by a penthouse addition to an office or hotel, or even by an extension to a dwelling-house close to a road. It is the buildings which matter and not their use. The trouble with leaving this area for the moment is that if such features become damaged, spoilt, or completely eroded by neglect then they cannot be replaced. One cannot replace something that is a part of one's history—as listed buildings and so many conservation areas are. Local planning authorities ought to be able to take sound planning decisions on planning grounds without having to look over their shoulder at the likelihood of claims for compensation.

Secondly, during Second Reading the Minister said, as I understand from reading his remarks, that the provision in question was restricted to flats because in that case there was evidence of abuse. I would again plead that the protection of the heritage is difficult enough without waiting for evidence of abuse to pile up. If one waits for that, then a great deal may be lost. Once an historic building is gone, it is irreplaceable, and a conservation area can easily lose those characteristics which were the very features that caused it to be designated.

The Peaktop case to which many references have been made was decided in 1983, yet only now—two years later—are we being asked to close the loophole. If one applies a similar time-scale to conservation areas, then the Committee will be able to imagine what tremendous losses could occur in future. Meanwhile, planning authorities responsible for conservation areas, where land values are high, could face a battery of planning applications. Some of them—let us face it—are little short of blackmail. To say that nothing will be done to protect those areas until there is evidence of abuse is an open invitation for built-up vandalism by unscrupulous developers while there is time. Indeed, I would cite not just unscrupulous developers but also people whose intentions are perfectly good and honourable but who are wanting to do the wrong thing for these particular areas.

There is growing interest in the possibilities of either claiming compensation or using the threat of compensation to secure valuable planning permission. These grapevines work very swiftly and cover great areas of the country. Conservation areas are far too important to be left unprotected while we wait to see what practices now obtain and how far abuse is extended. The country cannot afford to wait and neither can the heritage.

My final point is that abuses have already occurred. There have not been many yet but the writing is on the wall. I will not go into details because the noble Viscount, Lord Craigavon, mentioned the case of the two-storey extension at the junction of Tregunter Road and the Little Boltons. This is, unfortunately, a classic example of where compensation could progress house by house in that area. The applications made it clear that they would claim compensation if they were refused permission and so—alas—it was granted. The planning committee and the local authority found themselves in a very difficult position. It is hard to blame them when one case invites parallel applications from other owners in similar property nearby.

The result is a snowball effect, and the Minister readily admitted this in the case of applications to extend blocks of flats. I submit that there is a very special and extraordinary case for listed buildings and conservation areas. To permit this Bill to go through without dealing with that point and without debating how it might be dealt with in future legislation is not only not good enough but will mean, in terms of our heritage, a great loss. I beg to move.

Lord Sandford

I support the noble Baroness but do not intend to do so at any great length because she has made the case very well. I put it to my noble friend on the Front Bench that it is a nonsense to have the full range of grant-making powers and controlling powers that are available to a planning authority in an outstanding conservation area but to leave this loophole wide open. It cannot be right. Now that he and his right honourable friends have the English Heritage Commission to advise them on these matters I hope that they will take its representations to heart.

5.30 p.m.

The Earl of Avon

I am grateful to the noble Baroness for putting her case so well and also to my noble friend Lord Sandford for supporting her. Extensions to listed buildings require a separate consent, the refusal of which does not attract compensation under Section 169, so that to that extent the amendment is clearly unnecessary. This is certainly the most tempting of the various invitations made in this Committee to widen the scope of the Bill in relation to Section 169. I should ask the Committee to resist it on the ground that it is unnecessary in respect of listed buildings and will be unfair to the owners of non-listed buildings in conservation areas; but I should like to have another look at what the noble Baroness said to see whether we cannot come back at another stage.

Baroness Birk

In view of what the Minister says I shall naturally withdraw the amendment and come back to it again later. In doing so I should say that the great importance is protection. I do not mind under which schedule or article it is done. The important point is the protection of listed buildings. I am absolutely aware that they have a protection in one way but at the moment the conservation areas do not; not in the terms in which we are speaking today. In view of the support from other noble Lords who have put their names to the amendment but have restrained themselves from speaking in the interests of time, and the tremendous support from all over the country for the amendment, even if the Minister would like it differently drafted, I hope that he will accept that this is a very serious matter. I withdraw the amendment in the hope that the Minister will find a way to solve it from his point of view and at least leave us with the protection that is absolutely necessary.

Lord Sandord

Before the noble Baroness sits down, may I make the additional point that my noble friend nearly said, but not quite? It is of course the unlisted buildings in the conservation areas that are most vulnerable.

Baroness Birk

I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 1, as amended, agreed to.

Clause 2 [Restriction on compensation: Scotland]:

[Amendment No. 21 not moved.]

The Earl of Avon moved Amendment No. 22: Page 2, line 32, leave out from first ("in") to ("contained") in line 33 and insert ("either an increase in the number of such dwellings contained in the building or an increase of more than one-tenth in the cubic content of any such dwelling").

The noble Earl said: I have already spoken to this amendment. I beg to move.

On Question, amendment agreed to.

Clause 2, as amended, agreed to.

Clause 3 [Short title and commencement]:

[Amendment No. 23 not moved.]

Lord Mottistone moved Amendment No. 24: Page 2, line 42, leave out ("twelve months") and insert ("five years").

The noble Lord said: As I see it, the effect of Clause 3(2) will be to make refusals of planning permission still compensatable if the application for permission is made within 12 months of the Bill being passed. What I fear is that the effect of these changes will be to make governments less inhibited in future about amending development orders and also to make local planning authorities feel more free to refuse planning applications for development formerly falling within the development orders where such applications are made after the 12 months' cover period. Hence my proposal to extend the period to five years. I hope that the Minister can reassure me regarding the fears I have expressed. I beg to move.

The Earl of Avon

My noble friend has slightly astonished me because I thought he had already spoken to this amendment with Amendment No. 6. Certainly I have no more to add so I hope that he will read my earlier reply.

Lord Mottistone

That is not really good enough. I hope my noble friend will be able to take note of what I said and perhaps come back to me before the next stage so that I can put off tabling the amendment again because of his inadequate answer.

The Deputy Chairman of Committees (Earl Cathcart)

Is the noble Lord withdrawing his amendment?

Lord Mottistone

No. I am waiting for an answer.

The Earl of Avon

There is nothing more I can add to what I have already said in my response to Amendment No. 6. I will willingly read it out again but I hope that it is not necessary. The provision of a five-year period across the board will be likely to undo much of the effect of this part of the Bill because of the possibilities that it will provide for abuse. I then asked my noble friend to look at it again.

Lord Mottistone

Obviously I do not want to press this hard at this stage; but I certainly reserve the right to come back at the next stage. I hope that between now and the next stage my noble friend will read carefully what I said. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Mottistone moved amendment No. 25: Page 3, line 3, leave out ("23rd January 1985") and insert ("the passing of this Act").

The noble Lord said: On this amendment I have been advised by the Country Landowners' Association and the amendment is also backed by the CBI. Your Lordships will see that I propose to change the date of "23rd January 1985" to "the passing of this Act". It is my view that as a point of principle it will be inequitable and inappropriate for this Bill, if passed, to have retrospective effect. Landowners' rights as affected by Clause 1(2), and of course business rights, have been in existence since 1948 and while I do not oppose the main thrust of Clause 1(2) I feel that they should not be removed so peremptorily. I beg to move.

The Earl of Avon

I recognise what my noble friend Lord Mottistone has said. It is unusual to bring planning legislation into operation from the date of introduction, although in fact such a provision is not uncommon in fiscal legislation. The reason why we are proposing such a retrospective provision is perfectly simple. We are shutting off a possibility of abuse which was being increasingly exploited. If we had not made the provision retrospective I have no doubt that many more unacceptable planning applications would have been submitted during the passage of the Bill so that its purpose would effectively have been frustrated. That would he quite unacceptable. I accept of course that there may have been some bona fide applications which were not submitted in time, which may now fare differently from the way in which they would have done in the absence of the Bill; but if those applications are sensible and acceptable on planning grounds I would expect the local planning authority to give permission. If they are unacceptable I see no reason why the local planning authority should be required to pay compensation on them.

Retrospective legislation is not unknown where it is used to prevent abuses. In this case the sensible and fair date is the one in the Bill. I very much hope that with that explanation my noble friend will withdraw his amendment.

Baroness Birk

I should like to support the Minister. He is absolutely right. A Bill of this sort cannot be passed with the opportunity for abuses which must arise. As the Minister explained very clearly, abuses would certainly arise particularly in this area of planning applications. I hope that the Minister sticks to his guns about the date—and I am sure he will—so that there cannot be an abuses, however few.

Lord Mottistone

I thank my noble friend for his remarks, which I shall read with care. At this stage I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 3 agreed to.

House resumed: Bill reported with amendments.