Lords Sitting of 24 October 1988

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

Minorco Bid for ConsGold
Lord Morris Lord Morris asked Her Majesty's Government:
Whether they believe that the Minorco bid for Consolidated Gold Fields is in the national interest.
Lord Strathclyde: My Lords, my noble friend the Secretary of State will take his decision on the question of the reference of the proposed acquisition by Minorco of Consolidated Gold Fields plc in the light of advice submitted by the Director General of Fair Trading. If he decides that this proposed acquisition raises issues of public interest sufficient to warrant a reference to the Monopolies and Mergers Commission, it will fall to the commission under the Fair Trading Act 1973 to report on whether the proposed acquisition may be expected to operate against the public interest.
Lord Morris: My Lords, I thank my noble friend for that Answer. Bearing in mind that this is the first time he is being interrogated at the Dispatch Box, is he aware that I am about to ask him a question of the most anodyne innocence and simplicity? Have Her Majesty's Government made or received any representations with regard to their concern about the integrity of supply of strategic minerals as it affects the British national interest and, indeed, the interests of other nations in the West?
Lord Strathclyde: My Lords, I should like to thank the noble Lord for his kind and encouraging words. As for his supplementary question, of course a large number of representations have been received covering a wide range of subjects, including that of strategic minerals. They will be considered by the Director General of Fair Trading as he sees fit.
Lord Williams of Elvel: My Lords, perhaps I may also congratulate the noble Lord on what I believe is his maiden Question at the Government Dispatch Box. Perhaps I may also say what a pleasure it is on our side that my noble friend Lord Callaghan of Cardiff is back in his place.
Noble Lords: Hear, hear‡
Lord Williams of Elvel: My Lords, will the noble Lord pass on to his noble friend the Secretary of State our clear view that it is contrary to the national interest that a substantial proportion of the supply of strategic minerals should be in the hands of South African interests?
Lord Strathclyde: My Lords, I should like to thank the noble Lord, Lord Williams, for his generosity in congratulating me. I may not always please the noble
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Lord in what I say, but he can rest assured that I will always try to do my best. I too should like to say how nice it is to see the noble Lord, Lord Callaghan, back in his usual place.
I shall pass on the noble Lord's remarks to my noble friend the Secretary of State. Consolidated Gold Fields has interests in mining companies in the USA and Australia as well as in South Africa, where it has a 38 per cent. holding in Gold Fields of South Africa Ltd. Minorco has said that it would dispose of that last shareholding if the bid succeeds.
The Viscount of Falkland: My Lords, is it not the case, to use racing parlance, that we have a situation where there has been a stewards' inquiry and there is considerable public unrest, as there has been in the past with major corporate dealings, about at least a likelihood of there having been some irregular happenings and a destabilisation of shareholding in a very large and important company? Have the inspectors who have been put in been given enough time? Is it not important that they should be given enough time, because it is tomorrow, I believe, that the decision has to be made?
Lord Strathclyde: My Lords, I should like to thank the noble Viscount for that question. Inspectors were appointed on 19th October under Section 442 of the Companies Act and Section 177 of the Financial Services Act. It is obviously not appropriate for me to comment on investigations by inspectors until their report is to hand. As to the question of time, the inspectors are well aware of the deadline, which is tomorrow, and I am sure that they will have taken that into account.
Lord Erroll of Hale: My Lords, does my noble friend not agree that the business should be frozen until the inspectors have reported?
Lord Strathclyde: My Lords, again it is for the inspectors, for the Office of Fair Trading and also for the Takeover Panel to take those decisions on how the regulatory process is carried out.
Lord St. John of Bletso: My Lords, will Her Majesty's Government bear in mind that ConsGold is already over 38 per cent. South African owned and that it has substantial interests there? is there any evidence that ConsGold has lost business as a result of its South African interests?
Lord Strathclyde: My Lords, I am not aware of ConsGold having lost any business as a result of having a 38 per cent. South African interest. However, I think it is worth pointing out to the House that under the Local Government Act 1988 all contracts by local authorities in this country must be let on purely commercial grounds.
Lord Morris: My Lords, following on from the question of my noble friend Lord Erroll of Hale, is my noble friend not aware that if no decision with regard to referral to the Monopolies and Mergers Commission is taken by three o'clock tomorrow afternoon, it is perfectly open to Minorco to further enter the market and further destabilise it with regard to the shares of Consolidated Gold Fields and the underlying British interests therein?
Lord Strathclyde: My Lords, of course the Government are aware of the deadline tomorrow. Your Lordships will note that we still have 24 hours to go.

Tax Cuts: Spending Impact
Viscount Hanworth Viscount Hanworth asked Her Majesty's Government:
To what extent they think that the extra money available to consumers from recent tax cuts has been spent on buying British manufactured goods as opposed to foreign imports.
The Parliamentary Under-Secretary of State, Department of Transport (Lord Brabazon of Tara): My Lords, the share of taxes in GDP was not changed by the Budget, so the impact on total spending is likely to be small. I expect cuts in tax rates announced in the Budget to improve the United Kingdom's economic performance and hence to increase output and exports.
Viscount Hanworth: My Lords, I thank the noble Lord for that reply. However, is he aware that many of us believe that the majority of the tax cuts which have gone into the consumers' pockets have not been spent in the United Kingdom? If that is so, does not the Minister agree, bearing in mind our problems with overseas payments and our difficulty in providing adequate funds for education and other urgent projects, that it is folly to consider any further tax cuts, as I understand the Government are still doing?
Lord Brabazon of Tara: No, my Lords, I could not disagree more with the noble Lord. Tax cuts over the past few years have revitalised the economy in this country, and it seems to me that the more of them the better.
Lord Boyd-Carpenter: My Lords, will my noble friend note that the views of the Liberal Party appear to be that as the citizen is not fit to use his own money, he must have it taken away in taxation?
Lord Brabazon of Tara: My Lords, I am not certain whether the Question tabled by the noble Viscount, Lord Hanworth, is in fact from the Liberal Benches. It is fairly typical of the views held widely across the Chamber.
Lord Bruce of Donington: My Lords, is it not the case that the tax cuts referred to in the Question have gone to swell consumer demand and that consumer demand, particularly for manufactured goods, has been reflected in the ever-increasing deficit in our overseas trade, specifically with Germany? Does not the noble Lord agree that it is high time that the Government apologise to the noble Lord, Lord Aldington, and his committee, who predicted precisely what would happen?
Lord Brabazon of Tara: My Lords, the report of my noble friend Lord Aldington is another matter to the Question on the Order Paper. The fact is that manufacturing industry is performing extremely well at the moment. Exports and manufactures in the
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three months to August are 8.5 per cent. higher than a year ago, and manufacturing productivity has increased by 7.5 per cent. in those three months. Clearly some of the money which people have in their pockets will be spent on imported goods; some will be spent on home produced goods; and some will be saved. However, as my noble friend Lord Boyd-Carpenter pointed out, surely the best person to judge how to spend his money is the person whose money it is—that is, the taxpayer.
Baroness Seear: My Lords, is the noble Lord saying that the sum total of decisions by consumers in this country necessarily adds up to what is best for the economy as a whole? Surely there is a strong argument for saying that the balance of payments deficit is largely as a result of too much credit and too much money in people's pockets. While I am on my feet, may I, through the Minister, inform the noble Lord, Lord Boyd-Carpenter, that most regrettably the noble Viscount, Lord Hanworth, went somewhere else.
Lord Boyd-Carpenter: Congratulations, my Lords‡
Lord Brabazon of Tara: My Lords, far be it from me to interfere by commenting on the last part of the supplementary question put by the noble Baroness. However, measures have been taken recently, as the noble Baroness will be aware, to raise interest rates, and that should choke off some of the present excessive demand.
Lord Underhill: My Lords, in view of the emphasis in the Question to the importance of buying British manufactured goods, as opposed to foreign imports, do not the Government consider that it is somewhat unfortunate in the interests of British employment and British manufacturing firms that British Airways should have placed a substantial replacement plane order with Boeing of America instead of ordering the part-British European Airbus?
Lord Brabazon of Tara: My Lords, that is another question. It must be a matter for British Airways to decide where best its commercial interests lie, whether BA is in the private or the public sector. Without knowing the details of the deal—and I do not—it would be unwise for me to comment upon it.

Natural Disasters: Emergency Relief
2.48 p.m.
Lord Molloy Lord Molloy asked Her Majesty's Government:
Whether they will initiate at the United Nations the creation of a standing task force for the purpose of giving emergency assistance in the event of natural disasters, such as floods.
The Minister of State, Foreign and Commonwealth Office (Lord Glenarthur): My Lords, we believe that current international arrangements for providing emergency assistance for natural disasters are working well.
Lord Molloy: My Lords, is the noble Lord aware that in various parts of the world, where tragedies have occurred in the past year, millions of men,

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women and children have died, and therefore they will not be able to protest at the Answer given this afternoon? Does not the noble Lord agree that it would be worthwhile for Britain, which has been very generous, to initiate a scheme whereby speed is of the essence in the saving of lives when these natural disasters occur?
Lord Glenarthur: My Lords, of course the many tragedies that we have seen are truly terrible. However, the fact is that a standing task force such as that proposed by the noble Lord would almost certainly be expensive to maintain, and it would not increase available resources for emergencies.
Lord Cledwyn of Penrhos: My Lords, is it not the case that the Government's performance in this regard is less than good? In 1979 the United Kingdom's contributions to the third world, including contributions to disasters, was 0.52 per cent. of GDP. That was regarded as reasonably generous, and at that time we were one of the top contributors. Last year however the figure was 0.28 per cent. Given that Ministers opposite constantly draw attention to the strength of the economy, and that we are exhorted by the Prime Minister to observe moral standards, cannot the Government do rather better than that?
Lord Glenarthur: My Lords, the noble Lord should not confuse two items. The Question relates to disaster relief. We respond quickly and generously, as the noble Lord, Lord Molloy, was kind enough to say, to appeals for assistance in tackling natural disasters. So far this year our emergency food aid, disaster and refugee relief totalled almost £80 million, including about £17 million for emergency disaster relief. As regards the more general point raised by the noble Lord about the target figure for aid, the net aid programme is planned to increase in real terms in the early 1990s. Furthermore, Great Britain has consistently exceeded the target of 1 per cent. of GNP for the combined amount of official and private contributions to development assistance.
Lord Cledwyn of Penrhos: My Lords, the noble Lord says that the Government have been generous in these matters. However, is it not the case that yesterday they decided to send only £10,000 to help those who suffered in the storm in Nicaragua? Can they not do better than that? I return to the exhortation to observe moral standards. If the economy is strong, why do the Government not help these people who are so unfortunate?
Lord Glenarthur: My Lords, the fact is that the Government are generous. It is also a fact that the £10,000 is an initial figure; it is the maximum cash response that we make without knowledge of precise local needs. We do not yet have the full details of what is required. That figure has been applied in other cases and it has been followed up with very generous aid.
Baroness Macleod of Borve: My Lords, further to the Question put by the noble Lord, Lord Molloy, will the Government initiate throughout the world a task force based on the United Nations as a result of which perhaps more countries will liaise and be able
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to send the right things to the right place at the right time?
Lord Glenarthur: My Lords, my noble friend may be aware that there is already an organisation called the Office of the United Nations Disaster Relief Coordinator, which was set up in response to a British initiative. It plays a vital role in mobilising and coordinating relief for natural disasters, including floods. I think that that meets the point made by my noble friend.
Baroness Ewart-Biggs: My Lords, can the Minister give an assurance that, in line with the recommendations from the Foreign Affairs Committee in another place and from Oxfam, the funds that the Government will give for emergency relief will be new money and will not be subtracted from the overseas development aid that we are at present giving?
Lord Glenarthur: My Lords, we look at every case on its merits. We respond generously, as has been said, to aid requirements to meet disaster relief and we shall continue to do so.
Lord Simon of Glaisdale: My Lords, is it appropriate to speak of the Government as being either mean or generous? Have the Government any money of their own?
Lord Glenarthur: My Lords, of course it is taxpayers' money but in these cases we strive to make the best use of the money to meet the case in point.
Baroness Ewart-Biggs: My Lords, I am sorry to press my point but the Minister did not answer it. Will the money given be new money or will it be subtracted from funds that we already provide for the overseas development budget?
Lord Glenarthur: My Lords, in some cases I suspect that it will be new money, but in the end there is the total aid budget to be looked at.
Lord Molloy: My Lords, if as the Minister said United Nations emergency action and responses to deal with these tragedies are adequate, can he briefly outline what they are?
Lord Glenarthur: My Lords, one of the difficulties is that the requirement for international assistance for natural disasters is sporadic. It is usually for emergency supplies and financial help rather than for international activity on the spot. The noble Lord is trying to set up some kind of task force. We fear that it would not add to what has already been put in hand on numerous different occasions, which has been demonstrated to work well.
Lord Molloy: My Lords, it has never been really tested. All I am asking, as have other Members on all sides of the House, is whether the Government will consider the proposition to see whether it can be accepted in the United Nations. Such an arrangement should save the lives of literally millions of men, women and children caught by these disasters. Speed is of the absolute essence for any aid that is forthcoming.
Lord Glenarthur: My Lords, an organisation already exists within the United Nations machinery. In answer to my noble friend Lady Macleod of Borve I referred to the Office of the United Nations Disaster Relief Co-ordinator. That office is working well and it was set up as a result of a British initiative some time ago.
The Earl of Halsbury: My Lords, taking one thing with another, and the present Question with the last, perhaps I may ask the noble Lord whether, by the time I have applied my tax cuts to the relief of the Sudan, the Bangladeshi floods and Jamaica, it is not time that the taxes were restored.
Lord Glenarthur: My Lords, I shall certainly not attempt to answer either the second main Question or the last supplementary question. We have given this subject a fairly thorough airing.

BP: Kuwaiti Shareholding
2.55 p.m.
Lord Belhaven and Stenton Lord Belhaven and Stenton asked Her Majesty's Government:
Why they ordered Kuwait substantially to reduce its shareholding in BP within a set time-limit of one year, and what effect they expect their decision will have on British people who invested in BP when it was privatised last year and on British relations with friendly Arab countries in the Middle East.
Lord Strathclyde: My Lords, the report of the Monopolies and Mergers Commission recommended that the Government of Kuwait should be required to reduce their shareholding in BP over a period of some 12 months. However, in order to promote an orderly disposal of the shareholding, the report also recommended that this period should be subject to some flexibility in the light of market conditions. My noble friend the Secretary of State accordingly asked the Director General of Fair Trading to consult the Kuwait Investment Office on this basis with a view to obtaining undertakings to reduce the shareholding in BP to not more than 9·9 per cent. and to advise him further on the appropriate timescale for divestment.
Lord Belhaven and Stenton: My Lords, I thank my noble friend for that Answer. Perhaps I may also add my congratulations to him, this being the first time that he has answered Questions at the Dispatch Box. I very much hope that it will not he the last and that he has a very happy time there.
Before I ask any supplementary questions I must declare an interest in this matter in that I am one of those who bought BP shares a year ago. Can my noble friend tell me whether Her Majesty's Government advised Kuwait, through diplomatic channels just a year ago, that they could see no objection to a Kuwaiti shareholding in BP of up to 20 per cent.? If that is so, can he explain why 20 per cent. was all right a year ago but 9.9 per cent. is considered to be the absolute maximum today?
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Returning to the interest that I declared, does my noble friend consider that Her Majesty's Government have a duty of care to those who bought shares in BP a year ago? What does he think——
Noble Lords: Too long‡
Lord Belhaven and Stenton:—will be the result on the value of the shares following upon the actions of Her Majesty's Government?
Lord Strathclyde: My Lords, I shall try to answer all those points. I thank my noble friend for congratulating me. I fear that the decision will not be mine, whether or not I shall be at the Dispatch Box again.
Ministers have made it quite clear to the Kuwaiti authorities over the past 12 months that the KIO stake was getting too high. They explained that the Office of Fair Trading was investigating the shareholding and that a reference to the independent MMC might result. Therefore it appears that the Kuwaiti authorities were quite aware of the position.
I have no knowledge of Ministers telling the Kuwait Investment Office that it would be allowed to buy shares up to 20 per cent., but I shall make further inquiries and write to my noble friend. As regards his buying shares this time last year, he bought them after the October 1987 crash. Therefore he would be well aware that the price of shares could fall as well as rise. The future price of BP shares is in the hands of the market.
Lord Williams of Elvel: My Lords, does the noble Lord not agree that the Kuwait Investment Office rescued the Bank of England from its obligations as buyers of last resort in last year's fiasco? Does he not further agree that the sensible and elegant solution, which he might wish to pass on to his noble friend the Secretary of State and which might perhaps solve the problem of the noble Lord, Lord Belhaven and Stenton, who I understand has been financially damaged by what has happened since, is for the Bank of England now to live up to its obligations and acquire the KIO holding at the price it was then prepared to offer? Would not that solution prevent a false market in BP shares, protect the interests of BP shareholders and show that Her Majesty's Government are prepared to put their money where their mouth is?
Lord Strathclyde: My Lords, I am always delighted to pass on the advice of the noble Lord, Lord Williams of Elvel, to my noble friend the Secretary of State. The Kuwait Investment Office did not help out the Government in any way when it bought the shares. It was entirely a commercial decision taken at that time. It must be remembered that the Kuwait Investment Office has been investing in this country for a considerable time and is well experienced in it.

Housing Bill
3.1 p.m.
Report received.
Clause 1 [Assured tenancies]:
The Minister of State, Department of the Environment (The Earl of Caithness)The Minister of State, Department of the Environment (The Earl of Caithness) moved Amendment No.1:
Page 2, line 3, after ("(2)") insert ("or subsection (5)").
The noble Earl said: My Lords, I should like to speak at the same time to Amendment No. 3. It might help to refresh your Lordships' memories, as it was some months ago—before the summer recess—that we dealt with Part I of the Bill if I make a general comment. Many of the amendments tabled by noble Lords opposite raise issues which we discussed at considerable length in Committee. They emphasise once more the wide divergence of view between the two sides of the House on the subject of lettings by private landlords.
Put at its simplest, the Government's position is this. There is a substantial demand for good quality private rented accommodation. Landlords will not come forward to meet that demand unless rented property becomes once again an attractive investment proposition. There is no chance of that happening unless, first, landlords are given the freedom to charge a rent which is not held down by statute to unrealistically low levels—in other words, it must be a genuine market rent—and, secondly, lettings take place on terms which maintain an equitable balance between the respective interests of the landlord and the tenant.
That is what the proposals in Part I of the Bill are about. We are confident that they will result in both an increase in the overall supply of accommodation available for letting and a marked improvement in its quality. Unfortunately, many of the amendments proposed by noble Lords opposite indicate a continued unwillingness to accept our approach on this issue and I am afraid that this may lead to a little disagreement between us at later stages today.
The amendments now being discussed are designed to help local authorities to arrange temporary accommodation for homeless people to whom they owe a duty under the homelessness provision of the Housing Act 1985. They are a response to representations which we have received in recent months.
Under the 1985 Act local authorities have a duty to house the homeless temporarily in certain circumstances; for instance, where further inquiries have to be made about whether they are in priority need or where they have priority need but become homeless intentionally. The homeless person may or may not receive an offer of permanent accommodation depending on whether the authority decides it has a duty to arrange this. Where an authority provides the temporary accommodation itself, it will normally have no difficulty about obtaining possession when the time comes for the occupant to leave because lettings of this temporary kind are not secure tenancies for the first 12 months by virtue of paragraph 4 of Schedule 1 to the 1985 Act.
There can, however, be problems where the temporary accommodation is provided by arrangement with another landlord. The Association of District Councils and the National Federation of Housing Associations are particularly concerned
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about accommodation provided by housing associations; but similar considerations apply in other cases. The accommodation may be intended for temporary use by homeless families, not for permanent occupation. Indeed, part of the Housing Corporation's programme is devoted to the provision of accommodation of this kind. The landlord therefore needs to be sure that he can get possession to house other families. Shorthold may not be adequate for this purpose because it only guarantees possession at the end of the minimum term of six months. These temporary lettings may well be for shorter periods. Nor will the suitable alternative accommodation possession—Ground 9 in Schedule 2 to the Bill—be appropriate in many cases.
These amendments, which are modelled on the equivalent provision in the 1985 Act, provide that a tenancy granted by arrangement with a local authority pursuant to its duties to arrange temporary housing will not normally be assured during an initial 12-month period following the notification given to the tenant by the authority under Sections 64 or 68 of the 1985 Act. This will enable the landlord to get possession within that 12-month period, when he needs it. If the 12-month period lapses, then the tenancy will become assured. But, as under the secure tenancy provisions of the 1985 Act, that seems justified because the accommodation cannot reasonably be held to have been temporary. I beg to move.
Lord McIntosh of Haringey: My Lords, in responding to the amendments, I shall not follow the Minister in his general observations about Part I of the Bill except to say that I am sure he is right that there will be considerable disagreement between us on a number of the matters before the House this afternoon.
We assume, although it is not entirely clear from the wording of the amendments, that the other landlord body is to be a housing association. I should be grateful if the Minister can tell us whether these amendments apply also to approved private landlords, or indeed whether they apply to housing action trusts where those are established. In general we are not opposed to the amendments, but we do not think that they should be an opportunity for offloading the local authority's responsibilities for homelessness. They should certainly not be an opportunity to make it possible to provide temporary accommodation for the homeless other than in the restricted circumstances already provided by homelessness legislation.
We would not wish by means of these amendments to see temporary accommodation for the homeless encouraged in place of permanent accommodation for the homeless. I should be grateful for the Minister's assurance that this will not be the case.
The Earl of Caithness: My Lords, I can confirm that the amendments cover private landlords. I considered the matter at some length because there were arguments on both sides as to whether one should give this right to private landlords. My right honourable friend the Secretary of State and I considered that the right thing to do was to allow private landlords to help local authorities in this way.

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An argument was put to me that the landlord could take advantage of the provisions in order to avoid the terms of the legislation. However, there has to be a formal arrangement with the local authority and I suggest that this should be in writing. If it comes to a court action the defence must be that there was a written agreement with the local authority. If that is not the case it could be held that a landlord was trying to circumvent the powers in the Bill, something of which neither I nor the noble Lord, Lord McIntosh of Haringey, would approve. That is why we extended it to private landlords. We thought it right to try to help local authorities in this instance.
Lord McIntosh of Haringey: My Lords, before the noble Earl sits down, can he confirm that under the amendments the duties of private landlords will be as strict as they would be if the alternative landlord were, for example, a housing association?
The Earl of Caithness: My Lords, yes; I am happy to confirm that the same rules apply to everyone.
On Question, amendment agreed to.
Lord McIntosh of Haringey Lord McIntosh of Haringey had given notice of his intention to move Amendment No. 2:
Page 2, line 23, after ("effect") insert ("subject to subsection (5) below").
The noble Lord said: My Lords, in rising to move amendment No. 2, with which Amendments Nos. 4, 13, 104 and 112 are associated, I should like to say how grateful I am to the department for the help it has given in framing the amendments. However, since I tabled them, I have had doubts especially about Amendment No. 13. Therefore I think it is best if I say now that I shall not move Amendment No. 2 and that I should also give notice that I shall not move the other amendments in the group. Perhaps I may have an opportunity to discuss the matter with the Minister before Third Reading.
[Amendment No. 2 not moved.]
The Earl of Caithness The Earl of Caithness moved Amendment No. 3:
Page 2, line 26, at end insert—
("(5) If, in pursuance of its duty under—

(a) section 63 of the Housing Act 1985 (duty to house pending inquiries in case of apparent priority need),

(b) section 65(3) of that Act (duty to house temporarily person found to have priority need but to have become fir meless intentionally), or

(c) section 68(1) of that Act (duty to house pending determination whether conditions for referral of application are satisfied),

a local housing authority have made arrangements with another person to provide accommodation, a tenancy granted by that other person in pursuance of the arrangements to a person specified by the authority cannot be an assured tenancy before the expiry of the period of twelve months beginning with the date specified in subsection (6) below unless, before the expiry of that period, the tenant is notified by the landlord (or, in the case of joint landlords, at least one of them) that the tenancy is to be regarded as an assured tenancy.
(6) The date referred to in subsection (5) above is the date on which the tenant received the notification required by section 64(1) of the Housing Act 1985 (notification of decision on question of homelessness or threatened homelessness) or, if he received a notification under section 68(3) of that Act (notification of which authority has duty to house), the date on which he received that notification.").
On Question, amendment agreed to.
[Amendment No. 4 not moved.]
3.15 p.m.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 5:
Page 2, line 26, at end insert—
("(4A) A person who is a tenant under an assured tenancy shall be entitled to make a complaint in accordance with subsection (1) of section [complaints against landlords of harassment or illegal eviction].
(4B) A person who is a tenant under a tenancy falling within Part I of Schedule Ito this Act (other than paragraphs 11 and 12) shall be entitled to make such a complaint as though subsection (4A) above applied to that person.").
The noble Lord said: My Lords, in moving Amendment No. 5, I should like to speak also to Amendments Nos.17, 22, 92, 95 and 98. With these amendments we return to the issue which in a sense dominated the first day of the Committee stage. The most serious anxieties expressed on that day were those about the adequacy of the Government's proposals to deal with the dangers of harassment by a small minority of unscrupulous landlords.
At that time we recognised that the Government were making at least part of a serious attempt to deal with the problems of harassment. But in the examples which we put forward of actual harassment—harassment which had been drawn to our attention very shortly before the debate took place in Committee—we found that many of them were simply not dealt with by the Government's proposed legislation.
We gave the example of Mr. Nicholas Hoogstraten—I shall not weary your Lordships with his exploits again, although he seems determined to weary the public with them in the press. However, I wish especially to refer back to his habit of acting as a landlord under many personal and company names. It is important that we should recognise the fact that the Government's proposals for dealing with harassment do not deal with the threat raised by Mr. Hoogstraten and other such landlords.
We also gave examples in Committee—with reference also to Mr. Hoogstraten—of the inadequate service provided by some local authorities when dealing with harassment cases and fulfilling their responsibilities under the Protection from Eviction Act. Many of Mr. Hoogstraten's cases took place in the Royal Borough of Kensington and Chelsea which, to its credit, has not only one but, I believe, several rent harassment officers. It has people to whom tenants can go in the town hall who are identified, who are recognised by other officers of the council and to whom reference can be made without a great deal of wandering around from one council department to another. And this is a Conservative-controlled council.
However, there are councils—perhaps with less serious harassment problems than the borough of Kensington and Chelsea, but with some, nonetheless—which do not provide that service. They have not taken up the opportunities under the Protection from Eviction Act to provide a service which is not only available but which is seen to be available and is comprehensive in its provision.
In response to our amendments at that time, the Minister expressed a doubt about the wisdom of forcing local authorities to have someone who is solely a harassment officer. I understand his concern.

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It could well be that smaller local authorities, in areas where harassment is a less serious problem, might well find it a waste to have a person dealing with nothing but harassment cases, because the work may be erratic in that at times it may be too demanding while at others not demanding enough.
In Amendment No. 92, which is the substantive amendment in the group, we propose that local authorities should have specific duties to deal with harassment and illegal eviction. They should also have the duty to appoint a proper officer to deal with such complaints. However, that does not mean that the "proper officer" will do nothing else. It does not mean that he will not be gainfully and usefully employed during the whole of his working life. It means that he will have this task as one of his duties; that it will be known to everyone concerned and that he will be immediately accessible to the general public, without the need for them to go around the houses from one local authority department to another.
One can well imagine cases where someone who is receiving housing benefit, for example, goes first to the housing benefit section. That section sends the person somewhere else in the housing department. The person then goes to the nearest estate manager, or he might be sent to the borough solicitor's department. Indeed, he might be sent almost anywhere within the council service if there is no clear understanding about which department is actually responsible. The amendment does not put any obligation on the Government. We are not asking for an increase in public expenditure. We ask that local authority services in this respect should be rationalised, should be clear and should be available to all without difficulty.
The reason we seek to put the provision into Clause 1 is because it is that clause which sets out the category as to whom this right of complaint would apply. After all, Clause 1 and Schedule 1—which is taken with it—attempt to provide a comprehensive framework for the kind of tenants to whom the new assured tenancy applies, and does not apply. Unless we include the provision in Schedule 1 we are failing in our duty to define the types of tenants for whom the local authority officers would be providing a service.
Parallel with these amendments is Amendment No. 22, which deals with racial harassment, and Amendments Nos. 95 and 98 which deal with the problem of front companies to which I have already referred. I think it is desirable that we should deal with all such matters concerning harassment at one time, so that the House can clearly see the range of deficiencies in the Government's proposals for dealing with harassment.
I turn now to Amendment No. 22. Unfortunately, racial harassment is not on the decline; it is increasing. It does not happen solely in areas where ethnic minority groups are well represented; it also happens in areas where the numbers of such people are low. I am sorry to say that it is not just harassment of ethnic minorities by ethnic majorities—if I may put it that way—but sometimes it is the other way round. Our amendment is designed to deal with all kinds of harassment whether it is by black people over white people, or by white people over black
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people. The provision is not put forward to introduce any sense of colour prejudice into the amendment itself.
There are difficulties for local authorities and housing associations trying to take legal action in cases of racial harassment. Often a situation which would not be thought of as harassment if it were not taking place between people of different ethnic origin might well slip beneath the net. It is always difficult to say what constitutes harassment and what constitutes a certain amount of bloody-mindedness which should not be dealt with by the law.
It is of course especially difficult for magistrates to deal with such matters because although they are highly skilled in using their judgment about what is serious and what is not—for example, in domestic situations—the boundary line is nevertheless most difficult to draw.
Racial harassment is so much more painful for those who suffer it that it is important that it should be given separate recognition in the legislation. The Commission for Racial Equality has given its general support to the approach that is made here, which singles out acts done on racial grounds against a person or persons of different racial or ethnic origin within the local authority area within which the dwelling house is situated. We are trying to get such acts dealt with with all the seriousness that we believe they deserve.
The third subject dealt with in the group of amendments is that of landords hiding their identities behind front companies. I am referring to Amendments Nos. 95 and 98. It is of course valuable to know that if a tenant is removed to another tenancy under the same landlord the tenant's existing rights are protected. Tenants will recognise the validity of that provision. The difficulty is when people such as Mr. Hoogstraten operate under a number of different companies so that although the company may be under the same control it may have a different name and may be a different legal entity. The very fact that the company is a different legal entity removes it from the coverage of the Government's harassment proposals. That is wrong. It is wrong that someone who has a regulated tenancy with a fair rent who accepts, perhaps out of naivety or for want of good advice—who knows?—what appears to be a similar tenancy from a new property company should find that it is an assured tenancy contract which does not give the same protection with regard to rent or eviction that the original regulated tenancy would have given. Amendments Nos. 95 and 98 are intended to achieve those objectives.
I am sorry to have brought the rather different examples of harassment together in one group. I believe that it is for the benefit of the consideration which your Lordships should be giving to the Bill on Report that we consider the range of dangers of harassment at one time rather than repeat them in different debates. I am also sorry for having spoken longer than I would wish to do when introducing amendments, but again I hope that it will be for the benefit of your Lordships' House that the matter is taken in this way. I hope that the Government recognise that our motives in putting forward the amendments, which are designed to improve their

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proposals to deal with harassment, are sincere, and I hope that they will agree that the fears that we and the tenants have are well founded and will feel moved to accept at least the spirit if not the wording of the amendments. I beg to move.
Lord Tordoff: My Lords, perhaps I may ask your Lordships to forgive me if I tend to lay the stress on the first syllable of the word "harassment". I hope that the noble Lord, Lord McIntosh, will not think that I am trying to play games. It just happens to be the way that I pronounce the word.
I support everything that the noble Lord said about the amendments. It is perhaps a little unfortunate that we have grouped them together because we are in danger of having a slightly confused debate. Nevertheless, I see the reason for it and I shall try to follow. I have nothing further to add on Amendments Nos. 5 and 17. The noble Lord made out the case extremely well. We look forward with interest to hearing what the Government have to say in reply. We support the amendments.
I took the trouble to discuss Amendment No. 22 over the weekend with a member of my family who is involved with housing associations in the inner London area. His reaction was that the amendment is important because housing associations—this applies also to local authorities—find themselves in difficulties where tenants harass other tenants. That is what distinguishes this amendment from the others. The other amendments relate largely to the activities of landlords. Amendment No. 22 relates to the activities of tenants against other tenants when they cause nuisance and especially nuisance relating to racial harassment.
In Schedule 2 we talk about grounds for the repossession of properties. The first two grounds are the failure to pay rent or a breach of conditions. Some housing associations will write into conditions of tenancy the prevention of nuisance and the prevention of racial harassment. A second ground is specifically the causing of nuisance. The problem for the housing associations is that to secure repossession one has to prove a breach and that it is sufficiently severe. In addition, if one operates under the first ground one has to show that the conditions of the tenancy were reasonable in the first place. That is where the problem arises, because a number of cases which have been dealt with in the courts have been thrown out on the grounds that racial harassment is not a frightfully important matter. That varies a great deal from place to place. There have been cases were applications for repossession have been thrown out on the grounds that racial harassment is not a reasonable point to put in conditions of tenancy. That is wrong.
We believe that a provision needs to be written onto the face of the Bill so that it is clear to the courts what Parliament wishes to achieve in this matter. That applies not only to courts but to voluntary management committees in certain areas. I am not talking about the major housing associations; there are some voluntary management committees of small registered housing associations which have turned a blind eye to this matter. They need to be told precisely
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what Parliament has in mind, and how deplorable we all find racial harassment.
In relation to Amendments, Nos. 95 and 96, I can only again emphasise that there is a spider's web of companies, or perhaps "onion" would be a better description, where one peels off layer after layer of companies to find who is at the centre of the spider's web or the kernel of the onion. That is grossly unfair to tenants who may be treated in a way which I am sure the Government did not intend under the Bill. These two amendments are intended to strenghen the Bill. I do not believe that there is a great party conflict over the amendments. They are largely technical. The Government may indicate that there are some technicalities, but I hope that they now understand why Members on this side of the House are moving and supporting the amendments. The amendments have our support.
The Lord Bishop of Liverpool: My Lords, I should like to speak to Amendment No. 22. I regret that I was unable to he in your Lordships' House at an earlier stage this year. I am not sorry for the reason, because I had a special time of sabbatical study leave in a tiny cottage in the Western Highlands, but I am sorry that I was unable to be part of the debate.
I agree with the noble Lord, Lord Tordoff, that the amendment is important. I have been talking to different housing associations. I have close links with the three biggest housing associations in Liverpool. They tell me that as landlords they need a sanction. Part of their concern is that under Ground 14 on page 109 of the Bill the word "neighbours" has disappeared and the words "adjoining occupiers" have taken its place. There is a real fear that in a law court this narrowing of the ground could prevent effective action against harassment. For example, a lawyer might say, "I can only be a nuisance to my adjoining neighbour; that is the person I live immediately next to. I cannot be a nuisance to my close neighbour." Housing associations tell me that as landlords they need a sanction against tenants who carry out acts of racial harassment in the neighbourhood.
Again, perhaps we may imagine a situation in the law courts. I am expressing something that Merseyside Improved Housing told me today. If there is a complaint of harassment by someone who is moved while the matter is in the process of getting to the courts, the judge may say, "Why are you proceeding?". There may well be harassment going on against other people and the fear again is that the adjoining occupier may be unhelpful in court.
It seems to me that Amendment No. 22 deliberately throws the net wide enough for the courts to be able to act when there is this kind of harassment. Fear is a very real issue in a number of inner city areas. We need to arm the housing associations who play a very important role with an effective sanction.
3.30 p.m.
Baroness Faithfull: My Lords, perhaps I may ask a question. I am not clear on the situation. Would it not be easier for the local authorities to deal with the matter rather than the court? Is that the argument?

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There should be a good relationship between local authorities and housing associations. Could not the local authorities deal with the situation? Perhaps the Minister can enlighten me.
The Earl of Caithness: My Lords, I agree with the noble Lord, Lord Tordoff, that this is a pretty rum grouping of amendments, if I may put it in those terms. Amendment No. 22 has nothing much to do with Part I: it proposes to deal with secure tenants under the housing Acts. It is therefore the odd man in this grouping. Of course we all deplore racial harassment. However, if the noble Lord, Lord McIntosh, agrees, I prefer to deal with that separately when we come to Amendment No. 22. It is on a different point from the one we are discussing in the group included under the noble Lord's Amendment No. 5.
It is common ground between us that no other government have done as much to tackle the problem of harassment that already exists as this Government in the Bill. We have brought in powers which have been strengthened as the Bill has progressed through both another place and this House. I think we have now put together a substantial package of provisions to prevent harassment. We have even brought in compensation where the tenant suffers harassment and the landlord cannot substantiate his case if the matter goes to court. So there has already been a marked ratcheting up and a stiffer code for landlords to follow in the future.
The amendments in this group show that there is a difference of approach between noble Lords opposite and those on this side in our attitude to local authorities. We do not believe that it is necessary to turn every power of a local authority into a duty. We believe, as I said earlier in Committee, that local authorities should generally have freedom to discharge their statutory functions in such ways as they choose. We may from time to time need to remind them about their powers, or to explain the implications of court decisions for the operation of their powers, but we do not believe that every power needs to be turned into a duty as though they would take no action otherwise.
As I mentioned to the noble Lord, Lord Ross of Newport, in Committee, we intend to write to local authorities—in fact, we shall be issuing a circular—setting out their powers on harassment. The noble Lord welcomed this, and I am sorry that he is not in his place today. I hope that other noble Lords will welcome it too. The circular will be wide-ranging. It will cover such issues as the advantages of having tenancy relations officers, the forms harassment can take, the implications of the new offences we are creating under Clause 29 and the new damages provisions under Clause 27, and, lastly, the implications of the recent compulsory purchase orders by the Royal Borough of Kensington and Chelsea. The local authority associations will be consulted on the circular in the normal way, and we shall also consult groups with a specialist knowledge of harassment issues, including Shelter and the National Association of Citizens' Advice Bureaux.
This, I believe, is the way to proceed, not by introducing a new duty when the powers already
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exist. I might stress, since the noble Lord has put down further amendments, that I wish to make clear the scope of the new duty. The powers would apply to all assured tenants, all non-assured tenants and all with security as periodic assured tenants under Clause 5. The scope of the Protection from Eviction Act is very wide. Important parts of that Act apply to all residential occupiers; to owner-occupiers as well. I believe the duty to investigate complaints which the noble Lords would introduce would be more limited than the powers local authorities already have. I believe that the noble Lord, Lord McIntosh of Haringey, answered his own point when he quoted some local authorities that already have these officers in place. Surely it is right to give them the power and for the local authority to decide.
Turning to Amendments Nos. 95 and 98, the noble Lord, Lord McIntosh of Haringey, reopens an issue we debated during Committee stage; namely, what steps are reasonable to safeguard the position of tenants who now have protection under the Rent Act. Our general approach is that it will not normally be possible to grant a new Rent Act tenancy once the Bill comes into effect. However, we recognise that there need to be some exceptions to this rule and these are set out in Clause 34. We have, in particular, accepted the importance of ensuring that tenants who at present have protection under the Rent Act do not lose that protection by virtue of the landlord persuading them to accept a new tenancy. Perhaps I may draw the attention of noble Lords to subsection (1)(b) which provides that any new tenancy which a landlord grants to someone who has an existing Rent Act tenancy—whether the accommodation is the same or different—can also be a Rent Act tenancy.
The noble Lord has argued that it would be right to broaden this safeguard still further to cover the situation where a Rent Act tenant accepts a new tenancy from someone who is connected with the previous landlord.
The noble Lord is concerned at the possibility that a landlord might seek to collude with a third party in order the deprive a tenant of his Rent Act protection. However, as I said at Committee stage, our view is that the safeguard he proposes would carry the risk of penalising the perfectly innocent landlord. A landlord might in good faith grant a new tenancy without any knowledge of the previous protected status of the tenant under a landlord with whom he happened to be associated and thus unwittingly create a Rent Act letting.
There is also the practical difficulty of how to establish a watertight definition of the connection between landlords. The noble Lord's solution is to resort to the definition included in the Income and Corporation Taxes Act. But one doubts whether even a definition as fearsomely complex as this would be proof against the landlord who was absolutely determined to abuse the system.
Our view is that Clause 34 as drafted provides as much protection for existing tenants as it would be reasonable to expect. The important point to remember is that no existing tenant with Rent Act protection can be forced to accept a new tenancy. So long as he retains his existing tenancy he will continue to have full Rent Act protection in respect of both

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rent and security. We shall of course ensure that our publicity material makes the legal position quite clear in order to minimise the chances of tenants being misled or deceived.
The noble Lord has again succeeded in bringing forward into our early discussions in the afternoon matters that in the most part relate to Clause 27 of the Bill. I am grateful that he has done so because it is an important subject. But we have given very great care to the matter to ensure that we have the wording right as the Bill stands.
Lord Broxbourne: My Lords, before my noble friend sits down, can he help the House in one respect on Amendment No. 98? The noble Lord opposite did not give any indication of what the tests are which are referred to in Section 839 of the Income and Corporation Taxes Act 1988. No doubt he thought that they were indelibly stamped on the minds of every noble Lord. I must confess that in that case I am an exception. I would welcome a little guidance and instruction as to the broad effect of these esoteric provisions.
The Earl of Caithness: My Lords, as I said, they are fearsomely complicated. Perhaps the noble Lord, Lord McIntosh, is better able to explain them than I am.
Lord Tordoff: My Lords, again bearing in mind that we are on Report, does not the noble Earl intend to say anything further on Amendment No. 22?
The Earl of Caithness: My Lords, when Amendment No. 22 is moved I shall have quite a lot to say.
Lord McIntosh of Haringey: My Lords, to mention the point of procedure first, if the noble Earl wishes to deal with Amendment No. 22 separately he is fully entitled to do so. I shall move it in such a way that he can make the many points which he wishes to make. I hope that they will be helpful points.
On the other amendments, all of which I consider to be part of the spectrum of measures necessary to protect the public from harassment, I am afraid that the Minister has not stilled our fears. I was of course interested to learn the views of the noble Baroness, Lady Faithfull, whose opinions I always respect on these matters. She asked why we should not leave local authorities to deal with these matters, as indeed the Minister said in his reply.
There are two problems about that. First, there is an extensive history of local authorities, with the best will in the world, seeking to deal with harassment through the courts and failing to do so. Frequently harassment cases do not reach the courts, but even when local authorities bring them to court they lose the case. The reasons why harassment cases have been lost in court are not all solved by the Government's proposals in the legislation. There are a number of aspects which we have picked out particularly for attention this afternoon where we do not believe that the courts will be given the extra power which they need to deal with harassment. They
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need that extra power as they have failed to deal with this problem in the past.
Secondly, I am sorry to say that, although Conservative boroughs such as Kensington and Chelsea, and many Labour boroughs, have a good record of dealing with harassment and the matter could safely be dealt with by them, voluntary bodies, in particular those dealing with victims of harassment, are frustrated by the lack of attention and action on the part of other local authorities of all political persuasions. I am talking about voluntary bodies concerned specifically with housing as well as the more general bodies such as citizens' advice bureaux.
It is a regrettable fact, but it is still a fact, that despite exhortation from the Government there are local authorities who do not perform their functions adequately. Even if those authorities perform their functions adequately, they do not let it be known to the people living in their areas how to reach those officers who could deal with the matter.
I share the view of the Minister that as far as possible it is desirable for local authorities to be given rights and not duties. I think that is a correct view of local government. I wish the Minister could persuade his colleagues to follow that view when it comes to other aspects of local government legislation. But perhaps as the Minister rises in the hierarchy—I am sure he will continue to do so—he will be able to persuade his colleagues of the wisdom of what he is saying. This matter, I am sorry to say, is an exception to that. This is a case where duties on local authorities, and above all duties on them to make their services accessible as well as to enable them to exist, are important and should be pursued. It is for that reason that I think it is necessary to take the opinion of the House on Amendment No. 5.
3.44 p.m.
On Question, Whether the said amendment (No. 5) shall be agreed to?
Their Lordships divided: Contents, 89; Not-Contents, 100.

DIVISION NO. 1

CONTENTS

Addington, L.

Falkland, V.

Amherst, E.

Fisher of Rednal, B.

Ardwick, L.

Gallacher, L.

Attlee, E.

Galpern, L.

Aylestone, L.

Gladwyn, L.

Banks, L.

Graham of Edmonton, L.

Birk, B.

Gregson, L.

Blackstone, B.

Grey, E.

Bonham-Carter, L.

Grimond, L.

Boston of Faversham, L.

Hanworth, V.

Bottomley, L.

Harris of Greenwich, L.

Bruce of Donington, L.

Hayter, L.

Callaghan of Cardiff, L.

Henderson of Brompton, L.

Carmichael of Kelvingrove, L.

Henniker, L.

Cledwyn of Penrhos, L.

Hughes, L.

David, B.

Hylton, L.

Davies of Penrhys, L.

Hylton-Foster, B.

Dean of Beswick, L.

Irving of Dartford, L.

Donaldson of Kingsbridge, L.

Jeger, B.

Dormand of Easington, L.

Kinloss, Ly.

Elwyn-Jones, L.

Leatherland, L.

Ennals, L.

Listowel, E.

Ewart-Biggs, B.

Liverpool, Bp.

1375

Llewelyn-Davies of Hastoe, B.

Sefton of Garston, L.

Longford, E.

Serota, B.

McIntosh of Haringey, L.

Shaughnessy, L.

McNair, L.

Shepherd, L.

Mar, C.

Soper, L.

Marsh, L.

Stallard, L.

Mason of Barnsley, L.

Stedman, B.

Mishcon, L.

Stewart of Fulham, L.

Molloy, L.

Stoddart of Swindon, L.

Nicol, B. [Teller.]

Strabolgi, L.

Northfield, L.

Taylor of Blackburn, L.

Paget of Northampton, L.

Taylor of Gryfe, L.

Peston, L.

Thurso, V.

Phillips, B.

Tordoff, L.

Ponsonby of Shulbrede, L. [Teller.]

Turner of Camden, B.

Underhill, L.

Rathcreedan, L.

Wallace of Coslany, L.

Reilly, L.

Walston, L.

Rochester, L.

Wigoder, L.

Russell of Liverpool, L.

Wilson of Rievaulx, L.

Sainsbury, L.

Winchilsea and Nottingham, E.

Seear, B.

Seebohm, L.

NOT-CONTENTS

Airey of Abingdon, B.

Hooper, B.

Alexander of Tunis, E.

Iddesleigh, E.

Allerton, L.

Johnston of Rockport, L.

Alport, L.

Killearn, L.

Arran, E.

Kinnaird, L.

Ashbourne, L.

Kitchener, E.

Belstead, L.

Long, V.

Birdwood, L.

Lothian, M.

Blatch, B.

Lovat, L.

Borthwick, L.

Lurgan, L.

Boyd-Carpenter, L.

McAlpine of West Green, L.

Brabazon of Tara, L.

Mackay of Clashfern, L.

Broadbridge, L.

Macleod of Borve, B.

Broxbourne, L.

Malmesbury, E.

Bruce-Gardyne, L.

Margadale, L.

Caithness, E.

Marley, L.

Cameron of Lochbroom, L.

Maude of Stratford-upon-Avon, L.

Campbell of Alloway, L.

Carnock, L.

Merrivale, L.

Cathcart, E.

Mersey, V.

Chelmer, L.

Morris, L.

Coleraine, L.

Mowbray and Stourton, L.

Constantine of Stanmore, L.

Munster, E.

Cottesloe, L.

Nelson, E.

Cox, B.

Nugent of Guildford, L.

Craigavon, V.

O'Brien of Lothbury, L.

Cullen of Ashbourne, L.

Orkney, E.

Davidson, V. [Teller.]

Orr-Ewing, L.

De Freyne, L.

Oxfuird, V.

Denham, L. [Teller.]

Perth, E.

Dudley, B.

Portland, D.

Effingham, E.

Rankeillour, L.

Ellenborough, L.

Rodney, L.

Elliot of Harwood, B.

Saltoun of Abernethy, Ly.

Elliott of Morpeth, L.

Sanderson of Bowden, L.

Erroll of Hale, L.

Simon of Glaisdale, L.

Faithfull, B.

Skelmersdale, L.

Ferrers, E.

Stanley of Alderley, L.

Fortescue, E.

Strathcarron, L.

Fraser of Kilmorack, L.

Strathclyde, L.

Gainford, L.

Strathspey, L.

Gibson-Watt, L.

Sudeley, L.

Gridley, L.

Swinfen, L.

Hailsham of Saint

Thomas of Gwydir, L.

Marylebone, L.

Trafford, L.

Halsbury, E.

Tranmire, L.

Havers, L.

Trefgarne, L.

Henley, L.

Trumpington, B.

Hesketh, L.

Vaux of Harrowden, L.

Hives, L.

Waldegrave, E.

Home of the Hirsel, L.

Whitelaw, V.

Resolved in the negative, and amendment disagreed to accordingly.
3.53 p.m.
Schedule 1 [Tenancies which cannot be assured tenancies]:
The Earl of Arran The Earl of Arran moved Amendment No. 6:
Page 101, line 8, leave out ("this Act comes into force") and insert ("the commencement of this Act").
The noble Earl said: My Lords, in moving Amendment No. 6 I should like to speak also to Amendments Nos. 204, 205 and 217. These are simply minor drafting amendments. I beg to move.
On Question, amendment agreed to.
Lord Graham of Edmonton Lord Graham of Edmonton moved Amendment No. 7:
Page 102, line 16, at beginning insert ("Subject to sub-paragraph (3) below,").
The noble Lord said: In moving Amendment No. 7 I should like also, for the convenience of the House, to speak to Amendments Nos. 10, 11 and 12.
I accept what the Minister said in opening the debate. However there are many matters on which we need reassurance or clarification. On the main thrust of the Bill we still remain at odds with the Government, but we are in the business of trying to produce legislation which is not only understandable but which takes account of the kind of problems which we draw to the attention of the Minister.
On a previous occasion when the Bill was before the House we believed that the Minister in charge of the Bill made helpful noises about the circumstances which give rise to these amendments. We are satisfied that there will be many instances under which—either fecklessly though certainly not recklessly but by virtue of not being fully aware of his rights or of the consequences of his actions—an assured tenant will find that a landlord has gained an advantage or is in a better position to exploit the situation than hitherto. The purpose of Amendment No. 7 is to protect an existing assured tenant when the landlord moves in and as a result becomes a resident landlord.
On 21st July the Minister said:
"I agree that there is a risk that an assured tenant could lose his rights in those circumstances if he accepted a new tenancy without understanding the significance of doing so. Therefore if the noble Lord will withdraw his amendments, I undertake that we shall consider the point with a view to tabling an amendment of our own at a later stage".—[Official Report 21/7/88; col. 1535.]
We are very happy to see the belt and braces approach. We have put down our amendment and the Minister has put down his. In order to achieve some improvement in the Bill I am moving the paving amendment (which is the one I am moving now) but I am very happy to listen to what the Minister has to say before deciding what to do. We are trying to protect people who will not understand fully what they have let themselves in for. I believe that the Minister's amendments which form part of this group will be acceptable to a great many people outside the House. I beg to move.
Lord Tordoff: My Lords, clearly this is an important matter. We also are glad that there are to be changes to the Bill at this point. It is clear that continuity of security of tenure where there is no substantive change in the circumstances of the tenant is absolutely essential. There was a possibility under

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the Bill that continuity of security would not exist. I have a pretty shrewd idea that the Government's amendments will carry the day. We should be happy for that to happen and are grateful to the Minister for taking the point.
The Earl of Arran: My Lords, in speaking to Amendments Nos. 7 and 12 I should also like to speak to Amendments Nos. 10 and 11. We believe that Amendments Nos. 7 and 12 moved by the noble Lord, Lord Graham of Edmonton, have the same aim as government Amendments Nos. 10 and 11. I hope that the noble Lord will accept my assurances that the amendments drafted by the parliamentary draftsman do what he requires.
The situation might well arise where a landlord purchases a property with a sitting assured tenant and then decides to move into the property himself and to grant a replacement lease. If he did so, the tenant could, as the Bill stands, lose his security of tenure. I believe that we are all agreed that in those circumstances it would be wrong for the tenant to lose what he had thought was permanent security.
The government Amendments Nos. 10 and 11 differ from Amendments Nos. 7 and 12 by covering joint tenancies and by providing a definition of landlord covering also joint landlords. These are worthwhile provisions which could prove very important to certain tenants. I shall be moving Amendments Nos. 10 and 11 and hope that in the meantime the noble Lord will be able to withdraw his amendments.
Lord Graham of Edmonton: My Lords, I am grateful to the Minister for saying so succintly that the amendments he has proposed give effect to what is proposed in our amendments. I shall be very happy in a moment or two to withdraw the amendments and to support those of the Minister.
We constantly hark back to what the Minister in charge of this Bill and his colleagues in the other place have said; namely that they do not wish to see anyone disadvantaged or made worse off by the impact of the Bill. However, we have frequently come across examples of certain groups or individuals in certain circumstances who appear to be worse off. A common feeling about this matter in which the Minister and his advisers agree that the illustrations that have been drawn to our attention are valid can only be beneficial to the Bill and I hope, for hundreds if not thousands of people. It is clear that in this very modest and marginal way the Minister has listened to what has been said to him not only in this House but outside it. In those circumstances I beg leave to withdraw Amendment No. 7.
Amendment, by leave, withdrawn.
4 p.m.
The Earl of Arran The Earl of Arran moved Amendment No. 8:
Page 102, line 20, after ("that") insert ("subject to Part III of this Schedule").
The noble Earl said: My Lords, in moving Amendment No. 8, I should like at the same time to speak to Amendment No. 14. These two amendments are designed to correct a flaw in the resident landlord
1378
provisions of Schedule 1, a flaw which, I might add, was also present in the Rent Act on which these provisions are based. The Government announced when the Bill was in another place that they would be bringing forward these amendments.
Paragraph 10 of Schedule 1 provides that, subject to certain conditions, lettings by resident landlords are not assured tenancies. Taken together with Part III of the schedule, it also provides that where the accommodation is let by trustees and one or more of the beneficiaries under the trust live in the building, the letting is not an assured tenancy. This follows closely the equivalent Rent Act provisions on resident landlords and trustees.
There is however a trap for trustees in these paragraphs in that if they were to grant a new tenancy to a person or persons, one of whom was an existing tenant of the same or substantially the same accommodation, that new tenancy could be an assured tenancy even though the beneficiary under the trust had been living in the building throughout. So in these circumstances the resident landlord exemption would cease to apply. It is quite likely that trustees in this position would not understand the significance of granting a new tenancy, which they might do at the tenant's own request. This is obviously inequitable and these amendments are designed to put the matter right. I beg to move.
Lord McIntosh of Haringey: My Lords, I wish the matter were as simple, clear and uncontroversial as the noble Earl suggests. I should like to remind the Government that in Committee on 21st July we moved an amendment to deal with this problem of the protection of tenants from incoming resident landlords. The problem is that with an incoming resident landlord the tenants are liable to lose their security if they co-operate with the incoming landlord by moving to another part of the premises.
We had understood from the Minister's reply that the Government were aware of this point and were trying to deal with it. My noble friend has just quoted the Minister's remarks from col. 1535 of Hansard in relation to another amendment, but I believe that they apply also to this amendment. The Minister said:
"I agree that there is a risk that an assured tenant could lose his rights in those circumstances if he accepted a new tenancy without understanding the significance of doing so. Therefore if the noble Lord"—
the Minister meant me——
"will withdraw his amendments, I undertake that we shall consider the point with a view to tabling an amendment of our own at a later stage".
If that is the response, it is not good enough. It refers to the specific case of trustees. It provides that when the resident landlord dies and the landlord's interests vest in trustees, the trustees can provide an unprotected tenancy. So far as I can see—and the noble Earl will correct me if I am wrong—it does not mean that the trustees can provide another assured tenancy. In fact it allows the trustees on behalf of the beneficiary of a will to change an assured tenancy into an unprotected tenancy.
I did not understand that that was the intention of the Government when the Minister responded to my amendment in Committee. Apparently the Bill does

1379
not give any rights to new tenants when the landlord is resident. The new tenant will have no right to apply to the rent tribunal for rent setting. The county court will not be able to extend a possession order by up to three months. In other words, if the trustees grant an unprotected tenancy they will be able to empty the property for sale.
I do not believe that any of us—at any rate those who sit on this side of the House—feel that this situation is satisfactory. We cannot agree that someone who has been living under a protected tenancy perhaps for a very long time should be thrown on the streets because his or her landlord has died and trustees take over. It is rather like requiring a wife to commit suttee when her husband has died. This additional measure of insecurity is not in the interest of tenants and cannot be in the interest of society. I cannot understand why the death of a landlord should provide an opportunity for a longstanding tenant, perhaps with a tenancy of many years' duration, to lose all the security that he or she has had for all that time.
An amendment to change the powers and responsibility of trustees does not in any way meet our point. I do not say that we shall necessarily oppose this amendment in the Division Lobbies, but I give notice that, unless we have satisfaction that the problem to which we have pointed and which the Minister appeared to recognise in Committee is in fact addressed in amendments, this is a matter that we shall have to bring up at Third Reading.
The Earl of Arran: My Lords, perhaps I can help the noble Lord on this point. With respect, these amendmenta are not about incoming landlords. As I explained, they are about trustees granting a new tenancy. The noble Lord is concerned about the situation covered by Amendments Nos. 10 and 11 which we have just discussed and which do what he wants in those circumstances.
Lord McIntosh of Haringey: My Lords, before the Minister sits down, perhaps I may reiterate that he oversimplifies the matter. The problem is that when the beneficiary under a will comes in and trustees have to give a new tenancy, it is perfectly proper and reasonable for there to be some adjustment of the premises occupied by a tenant and by the beneficiary under the will in order to meet the new family circumstances. It is in those circumstances that we are concerned that the tenant who is trying to be cooperative and to make way if necessary for a beneficiary under a will who has different or greater housing need should then be penalised for that cooperation because he is to be given a tenancy which is not protected in the same way as his existing one.
I do not think that this is a matter that we should pursue across the Floor of the Chamber, but I certainly give notice that it is a matter that we want to consider again before Third Reading.
On Question, amendment agreed to.
The Earl of Arran The Earl of Arran moved Amendment No. 9:
Page 102, line 26, after ("(c)") insert ("that").
The noble Earl said: My Lords, this is a drafting amendment to paragraph 10(1) (c) of Schedule 1,
1380
which at present is expressed ungrammatically. I beg to move.
On Question, amendment agreed to.
The Earl of Arran The Earl of Arran moved Amendment No. 10:
Page 102, line 32, at end insert ("and
(d) that the tenancy is not one which is excluded from this sub-paragraph by sub-paragraph (3) below").
On Question, amendment agreed to.
The Earl of Arran The Earl of Arran moved Amendment No. 11:
Page 102, line 37, at end insert—
("(3) A tenancy (in this sub-paragraph referred to as "the new tenancy") is excluded from sub-paragaph (1) above if—

(a) it is granted to a person (alone, or jointly with others) who, immediately before it was granted, was a tenant under an assured tenancy (in this sub-paragraph referred to as "the former tenancy") of the same dwelling-house or of another dwelling-house which forms part of the building in question; and

(b) the landord under the new tenancy and under the former tenancy is the same person or, if either of those tenancies is or was granted by two or more persons jointly, the same person is the landlord or one of the landlords under each tenancy.").

On Question, amendment agreed to.
[Amendment No. 12 not moved.]
Lord McIntosh of Haringey Lord McIntosh of Haringey had given notice of his intention to move Amendment No. 13:
Page 103, line 10, leave out from ("association") to ("or") in line 11.
The Earl of Caithness: My Lords, Amendment No. 13 is part of a group to which the noble Lord, Lord McIntosh of Haringey, spoke with Amendment No. 2. In his preamble he then said he would not move it as there was a problem with it. As the noble Lord was gracious enough to acknowledge that he had received help from the department on this, I wonder whether, if this amendment were moved, it would enable him to tell us what the problem is on drafting.
Lord McIntosh of Haringey: My Lords, if that is an invitation that is likely to achieve a response from the Government, I am pleased. However, I shall not move the amendment afterwards unless something extraordinary happens.
As we see it, the problem with Amendment No. 13 is that it deletes the housing co-operatives from the range of provisions for assured tenancies. Amendment No. 4, which preceded it, provided what appeared to be a useful link between the 1980 Act and the 1988 Act. We could see how that amendment might be useful, for example, for a co-operative which consisted of a group of three or four couples who had tenancies in common and wanted these provisions. However, if the effect is to delete housing co-operatives from the assured tenancies provisions in Schedule 1, on reflection that may be going further than we had originally intended. We should like to think about it again.
The Earl of Caithness: My Lords, I am grateful to the noble Lord. However, all Amendment No. 13 does is to transfer the definition of fully mutual housing associations, otherwise known as cooperatives, in some circumstances from where it is in the Bill to Clause 45, which is the interpretation clause for Part I.
Lord McIntosh of Haringey: My Lords, I am grateful to the noble Earl for what he has said. I have clearly misread the Bill. I do not think that I can move Amendment No. 13 without having moved Amendments Nos. 4 or 2. If I have wasted the time of the House, I apologise. It is appropriate that I should talk with the Minister before we come back to Third Reading. Perhaps we can have a very brief introduction to these amendments if, as appears, my fears are groundless.
[Amendment No. 13 not moved.]
The Earl of Arran The Earl of Arran moved Amendment No. 14:
Page 105, line 20, at end insert—
("18A. In any case where—

(a) immediately before a tenancy comes to an end the condition in paragraph 10(1)(c) is deemed to be fulfilled by virtue of paragraph 18(1) above, and

(b) on the coming to an end of that tenancy the trustees in whom the interest of the landlord is vested grant a new tenancy of the same or substantially the same dwelling-house to a person (alone or jointly with others) who was the tenant or one of the tenants under the previous tenancy,

the condition in paragraph 10(1)(b) above shall be deemed to be fulfilled with respect to the new tenancy.").
On Question, amendment agreed to.
The Earl of Arran The Earl of Arran moved Amendment No. 15:
Page 2, line 28, after ("of) insert ("this part of).
The noble Earl said: My Lords, Amendment No. 15 simply effects a minor correction in the drafting. I beg to move.
On Question, amendment agreed to.
Clause 5 [Security of tenure]:
4.15 p.m.
The Earl of Arran The Earl of Arran moved Amendment No. 16:
Page 3, line 41, at end insert ("and, accordingly, the service by the landlord of a notice to quit shall be of no effect in relation to a periodic assured tenancy").
The noble Earl said: My Lords, the intention of this amendment is to clarify Clause 5. The clause provides that the landlord can bring a periodic assured tenancy to an end only by obtaining a court order on one of the grounds specified in the Bill. Our intention is that the common law requirement that a notice to quit is needed to bring a periodic tenancy to an end should not apply to a periodic tenancy which is assured. Rather, the landlord would give notice of his intention to begin possession proceedings and the tenancy would come to an end only if the tenant agreed to leave or the court made an order. This is similar to the position for secured tenancies under the Housing Act 1985.
We have had representations, however, that Clause 5 as it stands does not render a notice to quit unnecessary or at the very least that the matter is open to doubt. It is obviously undesirable that landlords should be uncertain and so this amendment makes it absolutely clear that a notice to quit is not needed. I beg to move.
On Question, amendment agreed to.
[Amendment No. 17 not moved.]
Lord Dean of Beswick Lord Dean of Beswick moved Amendment No. 18:
Page 4, line 39, at end insert—
("(6A) A person whose right to possession depends upon a periodic tenancy within the meaning of this section shall be entitled, whether or not jointly with the landlord, to make an application to the Rent Assessment Committee for the registration of rent for the dwelling-house in respect of which the tenancy is held, in accordance with section (Access to Rent Assessment Committee) below.").
The noble Lord said: My Lords, this amendment, and Amendments Nos. 36, 38, 39 and 45 which are grouped with it, deal with the right of access to rent assessment committees by the tenants involved.
The Government have given repeated assurances that housing benefit will cover market rents set by the rent assessment committees. It has been stated:
"The real market rent must be met by housing benefit for those eligible for it…Where the rent assessment committee has determined the rent for a tenancy, the regulations will provide that that rent will automatically be accepted as a reasonable rent".—[Official Report, Commons, 27/6/88; col. 119.]
This is all very well, but this assurance could be classed as nothing but a smokescreen. In the case of many tenants, perhaps the majority, the rent assessment committees will not be allowed to set a rent. This will leave those tenants in the vulnerable position of having to bridge the gap between what the rent officer says is a reasonable rent for housing benefit purposes and the higher rent charged by the landlord. This is a recipe for a vast and growing problem of rent arrears—which is escalating in all areas now—widespread eviction and a homelessness explosion. Is this really what the Government wish to effect by this provision?
At an earlier stage of the Bill's passage, the Opposition spelt out the circumstances under which the rent assessment committees will not be allowed to determine a rent. But the message does not seem to have struck home with the Government. We shall therefore spell it out again. For instance, the rent assessment committee will not be allowed to determine a rent for assured tenants (a) during a fixed term tenancy, the rent determination clause applying only to the periodic tenancies; (b) during the first year of a contractual periodical tenancy; (c) at the end of the periods in both of the above examples unless a notice of increase is served; and (d) during any period in a periodic tenancy where there is a provision for an increase in rent.
For assured shorthold tenants such provisions apply (a) during any fixed term tenancy granted after the first fixed term; (b) during a periodic tenancy arising at the end of the first fixed term where no notice of increase has been served; (c) if the rent assessment committee considers that there are not a sufficient number of similar comparable tenancies in the locality and at the rent which the landlord may reasonably be expected to obtain; and (d) at the end of a fixed term contractual shorthold tenancy any determination by the rent assessment committee will cease to be the maximum recoverable rent—the rent can be increased by agreement between the landlord
and tenant—and there will be a period in which the tenant will have no access to the rent assessment committee. This period could be up to one year. For example, it would be one year if the rent assessment committee determines the rent on the last day of the fixed term tenancy.
However, this is not the end of the problem for tenants on low incomes. Even if the rent assessment committee registers a market rent, in effect the Bill allows the landlord to use his more powerful bargaining position to get the tenant's so-called agreement to a rent which is higher than the committee has set. Therefore in this case injustice is piled upon injustice. It is indeed unjustifiable, for together these provisions push people into poverty and frequently will result in more homelessness.
We have heard a great deal from Ministers about their concern that housing benefit subsidy should not be allowed to push rents up. In this Bill they have turned away from rent regulation by the rent officers. We are presented in this Bill with a rent fixing mechanism: it is the rent assessment committees. The Government claim that this solves the problem because housing benefit will match the rent set by that committee. But we have seen what appears to be the Government's true intention: to keep the number of tenancies with rent assessment committee rents to the minimum. Thus we are presented in practice with what could be determined in some cases as a sham.
Indeed the Minister admitted as much in Committee. He said:
"The Bill as it stands provides a mechanism under which the rent assessment committee can determine the rent payable under a shorthold tenancy, but it is considerably more restricted in scope than that envisaged in this amendment, and quite deliberately so".
The Minister went on to say:
"Generally speaking, our view is that the landlord and tenant should be free to negotiate a tenancy agreement and having once done so should be bound by its terms. That is why we have provided no access to the rent assessment committee for full assured tenancies granted for a fixed term or for short periodic tenancies which have been in existence for less than 12 months".—[Official Report, 21/7/1988; col. 1526.]
Later the Minister also spoke of a safety net for shorthold tenants, but said that it was only for use in limited circumstances and should not cut across the vital concept of a free market in rents.
There we have it. The Government's case is based on free negotiation between landlord and tenant and the vital concept of a free market. Everyone in your Lordships' House knows full well that for most people seeking a privately rented home there is no such thing as a free negotiation based upon an equal bargaining position. It is a matter of "accept the landlord's terms or go elsewhere". It is time that the Government and the Minister faced the reality of the situation and ceased repeating this myth.
How can it be said that where there is a queue of 30 would-be tenants or more waiting to be interviewed by the landlord for a property there can be any question of free negotiation? The Bill will weight the balance still more heavily in favour of the landlord. Do the Government really believe that a prospective tenant will be able to negotiate a full assured tenancy when a six months' shorthold is on offer and negotiate away a demand for key money? As for the vital concept of a free market, the result for tenants will be as I have said previously—ever increasing debts on their rents and the ever-present and increasing spectre of eviction and homelessness.
We are arguing for something very straightforward: that the rent assessment committee
1384
rent setting mechanism should be available to all assured and shorthold tenancies. That is not too much to ask. It would give substance to Government promises and would go a long way towards overcoming the Government's fears of a subsidy-led rents explosion. We are deeply worried by the restrictions placed on the role of the rent assessment committee and the effect they will have on the rent/housing benefit poverty trap. We ask the Government and the Minister, even at this late stage, to reconsider the situation and to reflect on the damage that could be done if the warnings are not heeded.
This part of the Bill had a very forceful airing during Second Reading and in Committee. I ask the Government to consider the situation very closely indeed because I believe that as it stands the tenants about whom we are concerned will have very little protection. If the intention is carried out as stated in the Bill it may have just the opposite effect on housing to the Government's declared intention. I beg to move.
The Earl of Caithness: My Lords, these amendments are indicative of the wide divergence of view between the two sides of your Lordship's House on the approach to lettings by private landlords which the noble Lord, Lord McIntosh of Haringey, and I commented on as regards the first amendment.
The Government's position is that landlords will only be prepared to meet the demand for rented accommodation—something which I assume all noble Lords would wish to see as much as we do—if they are able to do so on sufficiently attractive terms. That will of course involve the freedom to charge a market rent for the property—and I am pleased to see that the amendments of the noble Lord, Lord Dean of Beswick, imply a recognition of this basic truth. But it is also crucial in our view that landlords should, in general, be able to let their property in the expectation that the initial rent and other terms agreed with the tenant should be binding on a contractual basis without the risk of being overridden by statute.
That is why we are proposing that where the landlord and tenant negotiate a fixed term assured tenancy, the terms—including both the initial rent and any rent review mechanism—should be contractually binding on both parties throughout the duration of the tenancy. Access to the statutory machinery for settling the rent will not be available until the fixed term comes to an end.
In the case of an assured periodic tenancy, access to the statutory procedure will apply once the tenancy has been in existence for 12 months and then only if the tenancy agreement contains no rent review provision, We are modifying this approach in respect of shorthold tenancies, since we accept that some additional protection is justified given the likely pressure in that sector of the market. There the tenant will have the right of appeal for a statutory determination of rent, notwithstanding the terms of the tenancy agreement. Where the rent assessment committee determines the rent in such a case, that rent will be the statutory maximum recoverable. But apart from this the general provision will be that contractual terms cannot be overridden by statute.

1385
The noble Lord's amendments would he wholly at odds with our approach. They would involve a right to apply at any time for a registration of rent, regardless of any rent review provision in the tenancy agreement. That would be guaranteed to make the new regime unattractive to landlords, since they would have no assurance in granting a tenancy that the agreed terms as to rents would remain effective. There is little doubt that the private rented market would continue to diminish to the detriment of potential tenants.
Nor could we accept any proposal which involved making the rent determined by the rent assessment committee the statutory maximum rent for the property. We have provided that in those circumstances where a rent is determined, that should be the rent under the contract and it will not be open for the landlord to impose a higher rent unilaterally. But we believe it is right that the landlord and tenant should be free to decide on a different rent by mutual agreement if they wish to do so.
We accept the need for statutory procedures and the Bill provides them, but in a form which firmly underpins the free market principle and which in no way constrains the freedom of a landlord to negotiate a term on a contractual basis.
I turn now to Amendment No. 38. The noble Lord would wish to remove the provision to the effect that nothing in Clauses 13 and 14—which establish the statutory machinery for determining the rent under an assured tenancy—shall affect the right of a landlord and tenant to vary by agreement any term of the tenancy, including the term relating to rent.
We have included this provision on an argument to which we attach considerable importance, which is that the relationship between landlord and tenant is by no means an inherently hostile one. That is, I know, a view which the party represented by the noble Lord has always found difficulty in coming to terms with.
Contrary to what the noble Lord led us to believe about the great demand to go to rent assessment committees, there is plenty of evidence to suggest that the great majority of tenants are perfectly satisfied with their landlords and vice versa. Perhaps I could give your Lordships an example. About two-thirds of existing regulated tenancies do not have a registered fair rent despite the right of both landlord and tenant to apply for one. I checked this morning and I was told that the number of existing regulated tenancies exceeds 1 million. So there must be over 660,000 or so existing regulated tenancies which do not have a registered fair rent although both parties are entitled to apply for one.
We think it essential that the law should not operate in a way which prevents landlords and tenants from settling their affairs by negotiation or which makes it harder for them to do so. We accept the need for statutory procedures to be available in cases where agreement is genuinely impossible. The Bill provides such procedures and we are satisfied that these will ensure adequate protection where it is needed. But we are determined that the law should not at any stage get in the way of people who are
1386
perfectly willing and able to sort matters out independently.
4.30 p.m.
Lord Dean of Beswick: My Lords, I have come to regard the Minister favourably over the months and when I have faced him with my colleagues across the Dispatch Box I have always believed him to be receptive to something which had a great deal of justification. I am disappointed at the Minister's response to this group of amendments. He said quite clearly—and I respect him for this—that one of the major dividing issues on the Bill between Her Majesty's Government and the Opposition in general is the question of totally free market rents. That is what he says the Government believe in and are sticking to.
I accept, as the Minister said, that for two-thirds of the people presently regulated there is no need for this type of protection. However, we are talking about people who will be seeking tenanted property because there is no recourse to anything else. In the pressure areas they will be people who are very poorly housed or without a home. To expect those people to sit across a table in a renters' market to negotiate a fair rent with somebody when there is a queue of people waiting to make offers for a house is nonsense, as I think the Minister knows.
One of the points that I should like to press further with the Minister came out at Second Reading and at Committee stage. When a rent assessment committee makes a recommendation—and it is only a recommendation—on the scale of the rent which is accepted by the tenant, the landlord may say, I want that rent plus such and such a thing", where do the tenants, if they are in some difficulty in even meeting the initial rent, get the difference between that and the rent assessment committee's recommendation, which according to the Minister is what the Government will accept as a fair rent? In many of these cases we will not be talking about £1 or £2; in areas of high housing stress we will be talking in multiples of £10. That is not a ridiculous suggestion; it may well happen.
The question of homelessness has never left the Floor of this Chamber for any length of time. I cannot quote the exact words, but the Minister during Question time and debate has suggested that when this Bill becomes an Act it will affect homelessness. I accept that it will, but it will not have the effect that the Minister and the Government say it will. There will be people who will not be reimbursed for the X factor, which is the difference between what the rent assessment committee says and what the landlord demands. Inevitably, in my opinion, that will have an adverse effect on the figures of homelessness and drive them upwards.
I have said on more than one occasion in the last few months to your Lordships that there are predictions from people grappling with homelessness in London that by the turn of the century there could be 30,000 people sleeping in the streets unless dramatic action is taken. It is called the New York dimension. I do not know whether I shall be here to see the turn of the century, and perhaps a few more of us will not be; but would the Minister like to be

1387
around to admit, if it reached that point, this terrible adverse effect? One only has to walk around the centre of London to see the people who are sleeping out. I passed St. Martins-in-the-Field the other morning at about half-past 10 and there was somebody in a sleeping bag, sleeping on the steps of a place like that.
If tenants are not given adequate protection to negotiate rents that they can afford or that the Government will pay for them, I think that they are doomed to disaster. On that basis, unless the Minister is prepared to take this matter back and have a look at it, if the cleavage is so manifest between us, I do not see any alternative but to test the will of the House.
The Earl of Caithness: My Lords, I should like to comment on one aspect of what the noble Lord has said. I believe that there is a fundamental flaw in his argument with respect. He said that there may be a landlord who under certain circumstances finds the rent determined by the rent assessment committee not acceptable. He went on to say: "Then the landlord wants more. How is the tenant going to pay the X factor, the amount of money between what the rent assessment committee determines and what the landlord wants?" There is no X factor because the rent determined by the rent assessment committee will be the statutory maximum recoverable.
Lord Dean of Beswick: My Lords, I am surprised that the Minister is coming back on that point because that was the main point that I was making. That will be the rent that the tenant can recover. If the tenant, to any degree, is existing on housing benefit, that will be what he will be allowed to recover. The X factor that I was talking about was the amount that he cannot recover if he has no means of increasing the money for his housing. I do not see thousands of people queueing up to tenant houses in London other than those who are really in need. In some cases the rents will equate with the right to buy.
I am a little saddened by the Minister's reply. He has only stated the obvious in what we have been debating. On that basis I see no alternative but to test the opinion of the House.
The Earl of Caithness: My Lords, with the leave of the House, I think that the noble Lord again misunderstood me. The rent is a statutory maximum recoverable by the landlord. There is not an X factor.
Lord Dean of Beswick: My Lords, is the Minister saying that in all cases where a rent is agreed by the rent assessment committee and accepted by the tenant, if the landlord does not accept it and is prepared to act outside it, he cannot act outside it? What happens in such a case? Are the Government going to underpin any agreement that has been made by tenants where the rent assessment committee has indicated that it considers it a reasonable settlement?
Obviously the Minster is not going to be forthcoming on this matter. I think this illustrates the wide division which still exists between the government view and the protection that we seek for some existing tenants and potential tenants. On that basis, I do not think that there is any other course but to test the opinion of your Lordships' House.
4.39 p.m.
On Question, Whether the said amendment (No. 18) shall be agreed to?
Their Lordships divided: Contents, 72; Not-Contents, 112.

DIVISION NO. 2

CONTENTS

Addington, L.

Lawrence, L.

Ardwick, L.

Leatherland, L.

Attlee, E.

Listowel, E.

Aylestone, L.

Lockwood, B.

Banks, L.

McIntosh of Haringey, L,

Birk, B.

McNair, L.

Blackstone, B.

Mar, C.

Blease, L.

Mason of Barnsley, L.

Bonham-Carter, L.

Molloy, L.

Boston of Faversham, L.

Mulley, L.

Bottomley, L.

Nicol, B.

Bruce of Donington, L.

Northfield, L.

Carmichael of Kelvingrove, L.

Phillips, B.

Carter, L. [Teller.]

Pitt of Hampstead, L.

Cledwyn of Penrhos, L.

Ponsonby of Shulbrede, L. [Teller.]

David, B.

Dean of Beswick, L.

Rathcreedan, L.

Donaldson of Kingsbridge, L.

Rochester, L.

Dormand of Easington, L.

Seear, B.

Elwyn-Jones, L.

Sefton of Garston, L.

Ennals, L.

Serota, B.

Ewart-Biggs, B.

Shepherd, L.

Falkland, V.

Stallard, L.

Fisher of Rednal, B.

Stewart of Fulham, L.

Gallacher, L.

Stoddart of Swindon, L.

Galpern, L.

Strabolgi, L.

Graham of Edmonton, L.

Taylor of Blackburn, L.

Grey, E.

Taylor of Gryfe, L.

Hampton, L.

Tordoff, L.

Hanworth, V.

Turner of Camden, B.

Harris of Greenwich, L.

Underhill, L.

Hughes, L.

Wallace of Coslany, L.

Irving of Dartford, L.

Walston, L.

Jeger, B.

Whaddon, L.

John-Mackie, L.

Wigoder, L.

Kagan, L.

Williams of Elvel, L.

Kennet, L.

NOT-CONTENTS

Airey of Abingdon, B.

Davidson, V. [Teller.]

Alexander of Tunis, E.

Denham, L. [Teller.]

Allerton, L.

Elibank, L.

Alport, L.

Ellenborough, L.

Ampthill, L.

Elliot of Harwood, B.

Arran, E.

Elliott of Morpeth, L.

Auckland, L.

Erroll of Hale, L.

Belhaven and Stenton, L.

Faithfull, B.

Belstead, L.

Ferrers, E.

Benson, L.

Fortescue, E.

Birdwood, L.

Fraser of Kilmorack, L.

Blatch, B.

Gibson-Watt, L.

Blyth, L.

Gridley, L.

Borthwick, L.

Hailsham of Saint Marylebone, L.

Boyd-Carpenter, L.

Brabazon of Tara, L.

Halsbury, E.

Broadbridge, L.

Harvington, L.

Bruce-Gardyne, L.

Henderson of Brompton, L

Caithness, E.

Henley, L.

Cameron of Lochbroom, L.

Hesketh, L.

Campbell of Alloway, L.

Hives, L.

Carnock, L.

Holderness, L.

Cathcart, E.

Home of the Hirsel, L.

Chelmer, L.

Hooper, B.

Coleraine, L.

Hylton-Foster, B.

Colnbrook, L.

Iddesleigh, E.

Constantine of Stanmore, L.

Ironside, L.

Cottesloe, L.

Johnston of Rockport, L.

Cox, B.

Lauderdale, E.

Craigavon, V.

Lloyd-George of Dwyfor, E.

Croft, L.

Long, V.

Cullen of Ashbourne, L.

Lothian, M.

1389

Lurgan, L.

Pender, L.

McAlpine of West Green, L.

Portland, D.

Mackay of Clashfern, L.

Reading, M.

Macleod of Borve, B.

Rodney, L.

Malmesbury, E.

St. Davids, V.

Margadale, L.

Saltoun of Abernethy, Ly.

Marley, L.

Sanderson of Bowden, L.

Marsh, L.

Sempill, Ly.

Maude of Stratford-upon-Avon, L.

Skelmersdale, L.

Stanley of Alderley, L.

Merrivale, L.

Strathcarron, L.

Mersey, V.

Strathclyde, L.

Milverton, L.

Strathspey, L.

Monk Bretton, L.

Sudeley, L.

Montgomery of Alamein, V.

Swinfen, L.

Morris, L.

Terrington, L.

Mowbray and Stourton, L.

Thomas of Gwydir, L.

Munster, E.

Trafford, L.

Nelson, E.

Tranmire, L.

Nugent of Guildford, L.

Trefgarne, L.

O'Brien of Lothbury, L.

Trumpington, B.

Onslow, E.

Vaux of Harrowden, L.

Orkney, E.

Waldegrave, E.

Orr-Ewing, L.

Weir, V.

Oxfuird, V.

Whitelaw, V.

Resolved in the negative, and amendment disagreed to accordingly.
Clause 6 [Fixing of terms of statutory periodic tenancy]:
4.47 p.m.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 19:
Page 5, line 14, at end insert—
("(3) Where there is served on the landlord or his agent a written notice that there is a person in the dwelling house who is entitled to apply to a court for a transfer of the tenancy into his name under the provisions of section 24 of the Matrimonial Causes Act 1973, Schedule I of the Matrimonial Homes Act 1983 or section 12 of the Family Law Reforn Act 1987, the landlord or his agent shall serve a copy of any notice served under subsection (2) on that person.
(4) In any case where—

(a) At a time when a notice is served under subsection (2) above: and

(b) the terms of the statutory tenancy (including the rent) proposed in the notice are different from the implied terms,

the person so entitled under subsection (3) above to apply for a transfer of the tenancy under any of the said Acts, so long as he remains in occupation, shall have the same rights in relation to, or in connection with, any hearing held by the Rent Assessment Committee under subsection (5)(a) and subsections (6) to (9) below as the tenant.").
The noble Lord said: My Lords, in moving Amendment No. 19 I should like to speak to Amendments Nos. 27 and 37, and also to Amendment No. 33. That amendment, although it does not deal with exactly the same subject, is close enough for the House to benefit, I think, from a debate on the two related issues.
The clauses with which we are concerned in the first three amendments, Nos. 19, 27 and 37, are Clauses 6, 8 and 13. Under Clause 6 the landlord is entitled to propose a variation in the terms of tenancy which has to take place within a year of the end of the tenancy, and the proposed terms become the terms unless the tenant refers them to the rent assessment committee within three months of receiving the notice. The element to which I am drawing attention is the power of the tenant to refer the terms to the rent assessment committee within a given period.
Under Clause 8 the landlord must serve on the tenant notice of his intention to commence
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proceedings for possession at least two weeks, and in some cases two months, prior to the commencement of the proceedings. Unless notice is served by the landlord in the prescribed manner or the court considers it just and equitable to dispense with the requirement of such a notice, the court shall not entertain proceedings for possession.
Under Clause 13 the landlord may serve a notice on the tenant providing for an increase in the rent; this must take place at a certain time and a certain amount of notice must be given. It becomes the actual rent in the time stated unless the tenant refers the rent to a rent assessment committee.
The common element in all these amendments is that the rights of the tenant consist of the ability to refer the matter to the rent assessment committee. What we are arguing in connection with these amendments is that the interests of the tenant and his or her family will be secured only if those rights apply not only to the tenant but to the non-tenant, spouse or cohabitee.
One debate which we had in Committee was about how the landlord could know who was the non-tenant spouse or cohabitee. The objection made to the amendments which we tabled in Committee was that it became a burden on the landlord to try and identify the non-tenant spouse or cohabitee. That objection cannot be raised against these amendments because it is now the obligation of the non-tenant spouse or cohabitee to deal with the matter. They have the obligation to trigger the powers contained under the Act. It also avoids the need for the landlord to intrude into the personal affairs of the tenant which would be the case if the obligation were on the landlord to make the first move.
The second objection was that there was a difficulty in defining "non-tenant spouse" or "cohabitee—. Indeed, when I first thought about the matter I thought there was some substance in that because clearly "cohabitee" is very unclear in legal terms. Fortunately, that matter has also been dealt with by legislation of which we have been able to take advantage. I am referring not just to the Matrimonial Homes Act 1983 which follows the Matrimonial Causes Act 1973 which gives a definition of non-tenant spouse but also to the Family Law Reform Act 1987 when it comes into effect, which one can assume will be early next year. That will give us the remainder of the definitions we need in order to make these amendments stick.
When we considered the matter in Committee I do not believe there was much doubt about the justice of the claim which we were making; namely, that the rights of the family as a whole were only protected if that non-tenant spouse or cohabitee was given the same opportuntiy of going to the rent assessment committee as the tenant himself. If this case I do not apologise for saying "the tenant himself". The vast majority of cases of which we are speaking are women. We are talking about women who are not the tenants themselves but whose tenant husband or cohabitee perhaps walks out leaving the family in a position where the home is at risk.
I do not believe that that was an issue. I believe that we all agreed that that was right. Doubts were expressed about the definition and the problem of the

1391
onus on the landlord to find out who was the non-tenant spouse or cohabitee. I believe that we have solved those problems with these amendments and I hope that these amendments will commend themselves to the House and to the Government. If there are any difficulties about the wording then of course we can talk about that. However, the principle is very clear and I believe that the objections have been overruled so effectively by this wording that we should be able to make progress.
Amendment No. 33 is related but it is not quite the same. It relates to Clause 9 and grounds for repossession if there are arrears of rent. Nobody says that in the end landlords should not have the right of repossession if the rent is not being paid. However, the reason why the mandatory arrears ground giving no discretion to the court if the rent is not paid for three months is inappropriate in this case is that people living together do not necessarily communicate adequately. If they cease to live together they almost certainly fail to communicate adequately. Therefore it may well be not within the knowledge of the non-tenant spouse or cohabitee that the rent has not been paid.
This amendment seeks to say not that the non-tenant spouse or cohabitee can stay indefinitely but that at least the courts should have the opportunity to give them a chance, as they could under the Matrimonial Homes Act, to take over payment of the rent and subsequently apply to the court for an order to transfer the tenancy into their name.
I do not believe that the object of this amendment is controversial. I believe that all sides of the House would agree that added to the pain of the break-up of the family relationship there should not be a quite unnecessary and damaging threat of eviction from the family home. We would all agree that if there is a way for the courts to find a solution to the problem rather than mandatory eviction, which is the only present solution available to the courts, such a way should be sought. If our amendments are adequately drafted to make the intention clear, I hope that the Government will be able to support them.
I should point out that all these amendments are about families. They are about conventional and unconventional families; namely conventional families where one spouse is the tenant and unconventional families where the parties are not married. It is supposed to be the concern of this Government that we should keep families together and should value the family as a social unit. In supporting these amendments I believe that the House would be supporting the principle which is accepted by all sides of the House; namely, that whenever possible families should be kept together and where that is not possible, the possibility of damage, particularly the possibility of damage to children of the relationship, should not be allowed. I hope that these amendments will find favour with the House and with the Government. I beg to move.
Baroness Fisher of Rednal: My Lords, perhaps I may support my noble friend. As a magistrate sitting in the domestic courts, I find some of the problems which the noble Lord has enumerated so very well from these Benches. Whether one calls them
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cohabitees or, as is usual in the courts, common law husband and wife, we find on so many occasions that there is not only a problem with the maintenance. Often the woman is almost distraught because the rent has not been paid when he left her and there are three or four children to be coped with as well as the threat of eviction hanging over their heads. That very sad situation mainly affects women and children. For that reason, I hope that when the Minister replies he will give a very good reply to my noble friend.
Baroness PhillipsMy Lords, naturally I support my noble friend because like the noble Baroness I have seen this situation in the courts and the terrible tragedies which follow. However, I am rather fascinated by this term "co-habitee". Is it the one which is referred to in the papers as "the live-in lover"? I always find that slightly insulting as he has often brutalised the children and so on.
If the cohabitee is the common law husband or wife, is there a period for which they must have lived together? If there is a change in the relationship it seems a little dangerous if automatically the one who is living in the home at the time of the break up becomes responsible under the Act. Knowing the strange lifestyle of some people we shall have to watch that because far from making relationships more stable it could encourage rather more unstable relationships. Perhaps when my noble friend replies, he will give me a definition of "cohabitee".
The Earl of Caithness: My Lords, your Lordships will recall that the noble Baroness, Lady Ewart-Biggs, argued eloquently for the cause of non-tenant spouses in Committee and had some support from both sides of the Chamber. I should say that I appreciate the case made by the noble Baroness then and that made by the noble Lord, Lord McIntosh of Haringey, today in moving the amendment. As I am sure your Lordships appreciate, I am not unsympathetic to the aims of these amendments.
Amendments Nos. 19 and 37 are concerned with the position of the non-tenant spouse whose partner as tenant might agree to changes in the terms of the tenancy or rent which might adversely affect him or her, perhaps in order to spite him or her. So it requires the landlord who has been served with a notice telling him of the existence of the spouse (which of course he might not know about) to serve the non-tenant spouse as well as the spouse with notices under Clause 6 and Clause 13. Now the landlord's contract is with the tenant. If the husband and wife are joint tenants, they will both normally know about the notices.
I cannot say too strongly that husband and wife should always consider joint tenancies. They give both parties equal rights, and our advice literature will stress this. But where the landlord's contract is with a single tenant, the non-tenant partner does not have any contractual rights in relation to the terms of the tenancy and the rent, even if that person would, in the event of divorce, judicial separation or nullity, have a right to the tenancy itself. Perhaps I may refer, as did the noble Lord, Lord McIntosh of Haringey, to the woman in this event. She has these rights in relation to her husband, but not in relation to the

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landlord. So it would he wrong to give her rights to representation before the rent assessment committee when she does not in fact have any rights in relation to the contract which the committee is assessing. I agree that this is hard on her if the tenant should behave badly, but it is a fact. The tenant, after all, will be obliged to pay any increase he has negotiated with the landlord in what perhaps was an attempt to spite her.
5 p.m.
Lord Tordoff: My Lords, I am sorry to interrupt the noble Earl. Can he explain what happens if the tenant does not pay in those circumstances?
The Earl of Caithness: My Lords, I am coming to that and I shall cover the point raised by the noble Lord. Finally, I might add that it would be wrong for the committee to have to consider what might in essence be a marital dispute over terms of the tenancy when what it should be looking at is any disagreements there might be between landlord and tenant.
With Amendment No. 27 the position is slightly different. On the face of it it is reasonable that a non-tenant spouse who might be evicted from a property should know if the landlord of that property intends to repossess it, if she has let him know that she exists and in the event of divorce would have rights to the property. However, the amendment in practice does very little. It simply provides that if the non-tenant spouse says she is there, the landlord should tell her if he is bringing proceedings. But she will only have any rights to the tenancy if there are divorce proceedings or separation or nullity proceedings in prospect or under way. The amendment gives no further powers. It does not enable either set of proceedings to be influenced by or delayed by the other. It consequently has no practical effect. It applies only to assured tenants, not to Rent Act tenants or long leaseholders.
Baroness Seear: My Lords, I am sorry to interrupt the noble Earl. Unless I have misunderstood him, does he realise that what he said very much encourages people when they split up to go straight for divorce proceedings when there might well be a possibility of reconciliation if they did not have to take such action at that time? Surely that is the effect of what he said: one can only attain one's rights if one starts legal proceedings. I thought that the best practice was to encourage people to have a period during which they can attempt reconciliation, but this procedure works in the opposite direction, does it not?
The Earl of Caithness: My Lords, I believe that would very much depend upon the circumstances. I can envisage the circumstances which the noble Baroness has put forward. As I said at the beginning, the way to overcome the situation in the first place is to have a joint tenancy, which is something that we shall be advocating, as I said earlier. I shall take up again the point raised by the noble Baroness when I sum up at the end, because I believe that she has a legitimate point.
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I now turn to Amendment No. 33, because I was a little unclear as to whom, as it is drafted, it was aimed at. The amendment seems to he concerned both with spouses and former spouses with rights of occupation under the Matrimonial Homes Act: that is, those who have asked to have the tenancy transferred to them and those who have had it transferred to them. When the spouse is not the tenant and the husband is liable for the rent and responsible for the arrears even if divorce proceedings are afoot, the landlord proceeds against the tenant and is entitled to possession if he proves his case.
If the tenant makes a payment to the court to clear off enough of the arrears before the hearing date, the ground will not apply. If the court has transferred or is transferring the tenancy to the spouse and she is in arrears because of delays in the payment of benefit or maintenance, she is no different from any other tenant in arrears because of delays in benefit which arc not the fault of the tenant. A spouse who is not receiving maintenance payments would be eligible for a crisis payment or income support in the normal way. If she used this to pay off enough of the arrears, the ground would not apply.
It is a principle of Clause 9 that the court should not have power to adjourn proceedings where it is satisfied that the landlord is entitled to possession on one of the mandatory grounds. Ground 8 is not different from the other mandatory grounds in this respect. The landlord who is entitled to repossession should not be adversely affected by court delays or expected to bear the cost of those delays. A spouse, whatever rights he or she may have under matrimonial legislation and however hard the delays in payment to which he or she is entitled, is no different from anyone else in that regard.
I believe that these amendments have raised issues of matrimonial legislation more generally. I am sure that your Lordships have realised that they are very difficult fully to comprehend in the short time that we have to discuss them. From the very framing of the amendments they go to a much wider source. I accept that at the moment non-tenant spouses are in a worse position than the spouses of mortgagees when it comes possibly to losing their homes. There are all sorts of complicated issues to do with the handling of matrimonial and possession proceedings which need to be sorted out in relation to all sorts of tenancies. This is not a matter for my department but for the Lord Chancellor's department, and it is not something which can be sorted out in the short time we have left available on this Bill.
However, I give an undertaking to your Lordships that I shall refer the issues that have been raised today to my noble and learned friend the Lord Chancellor and keep the noble Lord, Lord McIntosh of Haringey, and the noble Baronesses, Lady Ewart-Biggs and Lady Seear, informed. I shall keep them up-to-date with the developments. They go wider than the Bill and raise important points to which, as your Lordships are aware from what I have said, we are not unsympathetic. I hope that I have covered the point raised by the noble Lord, Lord Tordoff, and perhaps I may recap on it. If the tenant does not pay the increase agreed, the tenant could be subject to possession by the landlord. I covered that matter

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after the noble Lord raised the point. The landlord can sue the tenant for arrears of rent. He might initiate bankruptcy proceedings and therefore it is not in the interests of the tenant not to pay the increase.
Lord Tordoff: My Lords, in relation to the non-tenant spouse with whom he is having an argument, it may well be in his interest, and that is the point I was trying to make.
The Earl of Caithness: My Lords, the contract is with the landlord and the tenant and not with the non-tenant spouse.
Lord McIntosh of Haringey: My Lords, let me first of all deal with the point raised by my noble friend Lady Phillips; she asked me to define cohabitee. I would not be so presumptuous as to attempt any legal definition. The phrase used in the amendment is not "cohabitee"; that is a word that I used for convenience. I was referring to the people who had the right of occupation under the Family Law Reform Act 1987, which has not yet come into force. The significant point about that is that it does not attempt to cover all kinds of cohabitees, it concerns only those with children. It concerns them if they have the right to apply to the court to have a property transferred to the child or to themselves if the court considers that it is in the interests of the child.
Unless there are children, we are not looking for rights for cohabitees at all but for something more modest. In doing that we are looking for the worst cases that we are afraid of in connection with the dangers of the breakup of a family which includes children. I hope that that will satisfy my noble friend that what we are doing here is not attempting to break new legal ground but using the existing law and trying to apply it in a modest and practical way to housing legislation.
The Minister expressed sympathy with the objectives of the amendments but said that they could not be dealt with by housing legislation but would have to be handled by the Lord Chancellor's Department, presumably by legislation to amend the Matrimonial Homes Act or the Family Law Act so that they apply to the new position arising from the Housing Act 1988. I find that very unsatisfactory, however much goodwill is involved.
Our amendments are extremely modest. Amendments Nos. 19, 27 and 37 refer specifically to the right of the non-tenant spouse and the cohabitee, as defined, to go to the rent assessment committee. We do not say that there should be a totally new right. We are talking about the power to go to the rent assessment committee whose powers and duties are laid down in this Bill. As we are not breaking new legal ground, and as we are not attempting a new definition, why can we not put this on the face of the Bill now and have done with it rather than allow injustice, which the Minister has recognised may occur, to take place pending further legislation from the Lord Chancellor?
I hope that the Minister will take this opportunity to interrupt me and to come back on this point before I go on to talk about Amendment No. 33. I am sad
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that the noble Earl is not willing to do so. He is avoiding the issue by over-generalising the importance of what is being said. What we are saying is extremely modest. It refers to existing definitions of non-tenant spouses and cohabitees. It does not make any new ones. It does not put a burden on the landlord. It puts the onus on these people to make themselves known and to go to the rent assessment committee. It gives them the powers which they would have with a joint tenancy. I would happily withdraw the amendment if I thought the Minister felt—if not at this stage, then at the next stage of the Bill—that this is a proper subject to be debated on the Housing Bill.
The Earl of Caithness: My Lords, with the leave of the House, of course it is a proper matter to be debated on the Housing Bill. I have not denied that. But, being restricted to assured tenants, it does not cover Rent Act tenants or long leasehold spouses. And perhaps it ought to. One is not unsympathetic but, with respect, the noble Lord underestimates the complications of the amendments. It is right that this should be a matter for my noble and learned friend the Lord Chancellor.
Lord McIntosh of Haringey: My Lords, I am very sad. I thought that we would be in agreement and that this was an issue on which we all wanted the same thing. We want to keep families together. And we want to achieve that by agreement on all sides of the House. If our amendment is defective in the sense that it applies to only one kind of tenancy, let us pass it now and put it right at Third Reading. It cannot be so difficult to give a group of people already defined in law access to rent assessment committees. I am searching for a way to withdraw the amendment, but I am not being given an opportunity to do so. I beg to move.
5.14 p.m.
On Question, Whether the said amendment (No. 19) shall be agreed to?
Their Lordships divided: Contents, 75; Not-Contents. 109.

DIVISION NO. 3

CONTENTS

Addington, L.

Ewart-Biggs, B.

Ardwick, L.

Falkland, V.

Attlee, E.

Fisher of Rednal, B.

Aylestone, L.

Gallacher, L.

Birk, B.

Galpern, L.

Blease, L.

Graham of Edmonton, L.

Bonham-Carter, L.

Grey, E.

Bottomley, L.

Hampton, L.

Broadbridge, L.

Hanworth, V.

Bruce of Donington, L.

Hatch of Lusby, L.

Carmichael of Kelvingrove, L.

Henderson of Brompton, L.

Carter, L.

Howie of Troon, L.

Cledwyn of Penrhos, L.

Hughes, L.

Cocks of Hartcliffe, L.

Irving of Dartford, L.

David, B.

Jeger, B.

Davies of Penrhys, L.

John-Mackie, L.

Dean of Beswick, L.

Kagan, L.

Donaldson of Kingsbridge, L.

Kennet, L.

Dormand of Easington, L.

Kilmarnock, L.

Elwyn-Jones, L.

Kinloss, Ly.

Ennals, L.

Listowel, E.

1397

Lockwood B.

Shepherd,

McIntosh of Haringey, L.

Stallard, L.

McNair, L.

Stewart of Fulham, L.

Mar, C.

Stoddart of Swindon, L.

Mason of Barnsley, L.

Strabolgi, L.

Mulley, L.

Taylor of Blackburn, L.

Nicol, B. [Teller.]

Taylor of Gryfe, L.

Northfield, L.

Thurso, V.

Phillips, B.

Tordoff, L.

Pitt of Hampstead, L.

Underhill, L.

Ponsonby of Shulbrede, L. [Teller.]

Wallace of Coslany, L.

Walston, L.

Rea, L.

Whaddon, L.

Rochester, L.

Williams of Elvel, L.

Seear, B.

Winchilsea and Nottingham, E.

Sefton of Garston, L.

Serota, B.

Winterbottom, L.

Shannon, E.

NOT-CONTENTS

Airey of Abingdon, B.

Lauderdale, E.

Alexander of Tunis, E.

Lothian, M.

Allerton, L.

Lucas of Chilworth, L.

Alport, L.

Mackay of Clashfern, L.

Ampthill, L.

Macleod of Borve, B.

Arran, E.

Malmesbury, E.

Ashbourne, L.

Margadale, L.

Auckland, L.

Marley, L.

Beloff, L.

Marsh, L.

Belstead, L.

Maude of Stratford-upon-Avon, L.

Bessborough, E.

Blatch, B.

Merrivale, L.

Blyth, L.

Mersey, V.

Borthwick, L.

Milverton, L.

Boyd-Carpenter, L.

Monk Bretton, L.

Brabazon of Tara, L.

Montgomery of Alamein, V.

Broxbourne, L.

Morris, L.

Caithness, E.

Mottistone, L.

Cameron of Lochbroom, L.

Munster, E.

Campbell of Alloway, L.

Nelson, E.

Carnock, L.

Nugent of Guildford, L.

Cathcart, E.

Onslow, E.

Chelmer, L.

Orkney, E.

Coleraine, L.

Orr-Ewing, L.

Colnbrook, L.

Oxfuird, V.

Constantine of Stanmore, L.

Pender, L.

Cottesloe, L.

Portland, D.

Cox, B.

Reading, M.

Craigmyle, L.

Reay, L.

Croft, L.

Rees, L.

Davidson, V. [Teller.]

Renwick, L.

Denham, L. [Teller.]

Rodney, L.

Donegall, M.

St. Aldwyn, E.

Elliot of Harwood, B.

St. Davids, V.

Elliott of Morpeth, L.

Saltoun of Abernethy, Ly.

Faithfull, B.

Sanderson of Bowden, L.

Fortescue, E.

Sempill, Ly.

Gardner of Parkes, B.

Sharples, B.

Gibson-Watt, L.

Skelmersdale, L.

Gridley, L.

Stanley of Alderley, L.

Hailsham of Saint Marylebone, L.

Strathcarron, L.

Strathclyde, L.

Halsbury, E.

Strathspey, L.

Harmar-Nicholls, L.

Sudeley, L.

Harvington, L.

Swinfen, L.

Henley, L.

Thomas of Gwydir, L.

Hesketh, L.

Trafford, L.

Hives, L.

Tranmire, L.

Holderness, L.

Trefgarne, L.

Home of the Hirsel, L.

Trumpington, B.

Hooper, B.

Vaux of Harrowden, L.

Hylton-Foster, B.

Waldegrave, E.

Jenkin of Roding, L.

Weir, V.

Johnston of Rockport, L.

Whitelaw, V.

Kaberry of Adel, L.

Wise, L.

Killearn, L.

Resolved in the negative, and amendment disagreed to accordingly.
5.22 p.m.
Clause 7 [Orders for possession]:
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 20:
Page 6, line 28, at end insert—
("(5) If the court is satisfied that ground 6 in Part I of Schedule 1 to this Act is established, then in making an order it shall award compensation to the tenant, at the rate of the rent payable per month at the time the possession order is made multiplied by the number of years the tenant has held the tenancy.").
The noble Lord said: My Lords, in moving Amendment No. 20 I should like to speak also to Amendments Nos. 24 and 26. We are now dealing with Clause 7 and Schedule 2 to the Bill, which relate to grounds for possession. The particular grounds for possession with which the amendments are concerned are those which apply at a time of redevelopment.
Amendment No. 20, in relation to Clause 7, deals with the issue of compensation to the tenant. We seek to replace a provision contained in the Landlord and Tenant Act 1954 which provides for compensation if tenants lose their tenancy as a result of redevelopment. I am told that the intention of the 1954 Act was that the compensation should be limited to removal expenses. However, I am not entirely sure whether that is the whole story. In any case, the existing provision does not seem to us to meet the needs of 1988 and the years to come.
Compensation for the loss of a tenancy is a much more serious matter now than it was in 1954. The difficulty of finding new accommodation at a time of loss of tenancy is perhaps greater now than at any other time in our history. We believe that it ought to be possible, in view of the large profits which landlords can make on redevelopment, for some compensation to be given to tenants under such circumstances.
In Amendment No. 20 we propose that the compensation should be made by order,
"at the rate of the rent payable per month at the time the possession order is made, multiplied by the number of years the tenant has held the tenancy".
The proposal is a modest one, not in the Swiftian sense but a genuinely modest proposal. We say that, even with a 30 years' tenancy, the tenant will receive only 30 months' rent. That is certainly not enough to enable a tenant to buy his own accommodation. It may not even be enough to enable him to pay the premium which it is proposed should now be legal for a new tenancy. Therefore we do not think that this will make any significant financial difference to the landlord who will receive the financial benefit of the redevelopment; but we do think that it ought to soften the blow to some extent to the tenant who has to lose his home at such a time.
Amendments Nos. 24 and 26 relate to Schedule 2 to the Bill. They deal with the situation where a tenant ought to be given, and could be given, alternative accommodation. The problem we face at the moment is that the law has no choice but to give the landlord possession if it can be shown that the property is to he redeveloped. There is no consideration open to the law in terms of the tenant's needs.
Let me give your Lordships an example of the kind of situation which could arise. An example is the case of two sisters who have lived together for a long period of time. One of them moved into the property earlier and is therefore the actual tenant: the other, although she has been living there for a long time, is not. I accept the Minister's advice on the issue of joint tenancies. I think he is right to say that we should all urge tenants to take on joint tenancies wherever possible. That must be the right course of action to take.
However, many people who have never in their lives had anything to do with the law find the thought of going to law to establish a joint tenancy foreign to their way of life. They find it foreign to their understanding of society and something which is foreign to any of their experiences and the way in which they have been living. They do not in fact do it. That is the truth of the matter. However much we wiser people may advise them to take on joint tenancies they do not do so because they have never had anything to do with the law and they do not wish to have anything to do with the law, except to obey it.
Let us suppose that the tenant, the sister who has been living in the property for the longer time, dies. The other sister is given notice that the landlord wants to redevelop the property. It could be the most simple form of redevelopment. It could be joining two adjacent houses together which can only be done if everyone is decanted from the property.
If the law has no choice but to offer possession to the landlord under redevelopment conditions then the surviving person, who was not the original tenant, is provided with nothing but the removal expenses. There is no offer of alternative accommodation. In effect she is thrown on the council, which has no choice but to treat her with whatever urgency her family circumstances require. Indeed she may not even be given any special consideration because she was probably living in accommodation which was adequate for two people and now there is only one of them to consider. So, after a lifetime of living with her sister, she is now in a position where she can easily be got out of the property by the simplest and most elementary redevelopment provision and the law has no power to temper the wind to the shorn lamb.
That cannot be right. It cannot be the Government's intention that there should be such a draconian and rigid provision for tenancies under such circumstances. I hope therefore that the House will find it possible to support tenants who are likely to suffer in this way because of the Bill's provisions. I also hope that the Government will find a way to make it easier for them. Even if the wording of our amendment is not right, I hope that the Government will accept that we are proposing something which is socially just and which deserves the support of your Lordships' House. I beg to move.
5.30 p.m.
The Earl of Caithness: My Lords, the noble Lord's amendment would require that a tenant against whom a possession order is made on Ground 6, which is the redevelopment ground, should receive compensation. The amendment does not actually
1400
specify who should pay the compensation, but clearly the intention is that it would be paid by the landlord. I see the noble Lord nodding so perhaps we may take that for granted.
Perhaps I might first of all remind your Lordships of the existence of Clause 11, which requires that where the landlord obtains possession on either the redevelopment ground or Ground 9—that is, suitable alternative accommodation available—he must pay the tenant a sum equal to reasonable removal expenses. So the tenant who suffers disruption in the circumstances involved in either of those possession grounds can be sure of receiving a measure of financial recompense. Noble Lords will recall that no such right to compensation was attached to the alternative accommodation ground in the Labour Party's Rent Act 1977. So we have made a great stride in that respect under our legislation.
The noble Lord's amendment would require the payment of compensation on a distinctly more open-ended basis, not specifically related to the tenant's removal costs. That would seem to us to involve penalising the landlord to an unfair degree. A court will not grant possession on Ground 6 at all unless some quite stringent conditions are satisfied. Where possession is granted, the landlord will be required to pay the tenant's removal costs. That seems to us as far as it is reasonable to go. To require further compensation on the basis of the formula set out in the amendment could involve a not inconsiderable sum of money, at least in the case where the tenant had been living in the property for a long time, and could well deter a landlord from using the possession ground when he had a perfectly good case for doing so.
I therefore hope that the noble Lord will accept that the Bill as it stands provides such redress for the tenant as is reasonable in the circumstances.
Amendments Nos. 24 and 26 are similar to amendments moved in Committee by the noble Lord, Lord McIntosh of Haringey. That is a ground which is intended to enable landlords who wish to develop their property to do so in certain circumstances and provided that certain conditions are fulfilled. They cannot use the ground in respect of sitting tenants. They can use it only in respect of new tenants who knew that development was a possibility when they took on the tenancies. They cannot use the ground if it is possible to do the development work with the tenant in situ. The ground has been devised to facilitate development where it is necessary and not to encourage the large-scale removal of sitting tenants.
There is already a discretionary ground enabling the courts to award possession where suitable alternative accommodation is available. A landlord who has such accommodation will use that ground. Why would a landlord be bothered with the complexities of Ground 6 if he had suitable accommodation available? We are not talking here about removing people who had expected to stay put for the rest of their lives; we are talking about people who took on a tenancy having assessed whether there was a possibility of that ground being used. The landlord would not have to provide suitable alternative accommodation for such tenants in such circumstances.
Lord McIntosh of Haringey: My Lords, as regards Amendment No. 20, the Minister takes pride in the fact that there is to be payment of removal expenses when the tenant is being dispossessed on the ground that alternative accommodation is available. I give him one and a half cheers for that. That provision is clearly a step forward, and I do not wish to underestimate it. However, being dispossessed when alternative accommodation is available and being dispossessed without alternative accommodation at a time of redevelopment makes all the difference in the world to the tenant. In the first case, the tenant, having accepted alternative accommodation, has somewhere else to live. The tenant who is being dispossessed as a result of the redevelopment clause is left on the street at the mercy of the local authority and whatever resources it may have. That tenant may have the worst shock that could happen to anyone in his life apart from bereavement—to find himself without a home.
The concession is welcome, but it covers only 5 per cent. at most of the injustice that is being proposed. In the extreme case of dispossession for redevelopment, some part of the profits which will undoubtedly be made—or the redevelopment would not be undertaken—should go to the tenant who is being dispossessed.
On Amendments Nos. 24 and 26, I fear that the Minister has not fully appreciated the social effect of what he is saying. He thinks that it is enough to say that because the tenant is new and the new tenant was aware on taking on the tenancy that there was a possibility of redevelopment, no mercy should be shown and that tenant should not have the right to alternative accommodation, just as the Minister has already argued that that tenant should not have the right to compensation for dispossession. I gave the example of the new tenant who is a new tenant only because the original tenant has died. The new tenant will have been in the property for a long time, long before there was any question of dispossession. I may be wrong and I may have gone too far. Perhaps we should make a distinction between genuine new tenants who have come in out of the blue and should have been aware of the possibility of redevelopment and the example that I gave. If so, and if the Minister is prepared to accept that the two cases are different and should be treated differently, he and I can talk about the matter and I can withdraw the amendment for further consideration.
The Earl of Caithness: My Lords, with the leave of the House, I am happy to look at the proposition the noble Lord has put to me.
Lord McIntosh of Haringey: My Lords, I am grateful for that. I am sure that we can have a sensible discussion to see whether we can come back on Third Reading. The Minister knows that I am not satisfied with his answer on Amendment No. 20, but so as to make progress on the other matters I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Earl of Arran The Earl of Arran moved Amendment No. 21:
Page 6, line 37, after ("than") insert ("Ground 9 or").
The noble Earl said: My Lords, when the Bill was introduced in another place Ground 9 of Schedule 2, under which a landlord can seek possession of a dwelling subject to an assured tenancy where suitable alternative accommodation is available to the tenant, was mandatory. As a result of discussion there the Government amended the Bill so as to make the ground discretionary. Thus the court does not have to order possession if it considers it unreasonable to do so. The amendment is simply consequential on that change. It ensures that a landlord cannot obtain possession under that ground where he has let the dwelling on a fixed term assured tenancy.
That was the original effect of the Bill, but in transferring the ground from Part I of Schedule 2 to Part II the position was unintentionally changed. It is inequitable that where a landlord has let some accommodation for a fixed term he should be able to remove the tenant for his own convenience. We draw a clear distinction between such cases and cases where the tenant has misbehaved. I beg to move.
On Question, amendment agreed to.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 22:
After Clause 7, insert the following new clause:
("Grounds for Possession: Racial Harassment.
.—(1) In Schedule 2 of the Housing Act 1985 (grounds for possession of dwelling-houses let under secure tenancies) in Part I (grounds on which court may order possession if it considers it reasonable), at the end of Ground 2 (nuisance or annoyance to neighbours) the following words shall be inserted—
"or has committed Acts on racial grounds against a person or persons of a different racial or ethnic origin residing within the local authority area within which the dwelling-house is located, and those Acts have interfered with that person's enjoyment of the dwelling-house or have been calculated to deter the person from occupying a particular dwelling-house".").
The noble Lord said: My Lords, in a debate on an earlier amendment the Minister expressed the wish for this amendment to be separated because he had a great deal to say about it. I do not know that I have much more to say. The points have been made on this side of the House not just by myself but by the noble Lord, Lord Tordoff, and others. The issue of racial harassment, to which the amendment refers, is sufficiently in your Lordships' minds for it to be unnecessary for me to remind the House of what was said only a few short hours ago. I move the amendment in anticipation of a favourable reaction to it from the Minister. I beg to move.
The Earl of Caithness: My Lords, I am grateful to the noble Lord for raising this matter again. I wanted to speak about it separately because I consider it to be very important. It was a point picked up by the noble Lord, Lord Tordoff, and by the right reverend Prelate the Bishop of Liverpool after the noble Lord, Lord McIntosh of Haringey, introduced the earlier amendment. I recall making this point in earlier debates on home affairs matters with the noble Lord, Lord Mishcon. I have no hesitation in making it again: the Government fully share the general concern about racial harassment and the desire to stamp it out. It is simply not acceptable that people should be prevented from the quiet enjoyment of their homes and should in some cases go in fear of

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their lives because of their racial or ethnic origin. That is a disgrace to any civilised community.
We are thus clearly concerned that there should be adequate provsions against harassment in the public and housing association sector. All that we disagree on is whether the present grounds in Schedule 2 to the Housing Act 1985 are adequate. Advocates for changing the existing law sometimes argue that this would be useful in order to show a government's moral commitment to stamp out racial harassment. However, our commitment is known and does not need such a further demonstration.
The fact is that three local authorities have brought successful cases against tenants under Ground 2, but I am aware that a few cases have been brought and have not succeeded. There is certainly no clear indication that cases have failed because the law was inadequate. The important point in my view therefore is that the law should be further tested. As your Lordships may be aware, my department has commissioned research on racial harassment from Brunel University and this is nearing completion. Our aim in commissioning that research is to give local authorities and other landlords of secure tenancies guidance on good practice. We have very much in mind that such guidance might facilitate a further testing of the existing law in the courts. Some problems in bringing cases against tenants will remain, however the legislation is worded. I am referring to the problems of persuading victims and others to give evidence, obtaining evidence that will stand up in court and perhaps in some cases persuading the landlords or the police to take accusations sufficiently seriously.
However we can make a positive contribution by giving the kind of guidance on good practice that I have mentioned. I know that local authorities are in many cases more sympathetic now to taking action as the increase in incorporating anti-harassment clauses in tenancy agreements shows. As drafted, the new clause covers racial acts by a tenant against people of a different racial or ethnic origin anywhere within the same local authority area.
I can see the argument for giving the landlord powers, as Ground 2 does, to help ensure that neighbours live peacefully together and to enable a landlord to remove the offending tenant where it would not be reasonable to expect both parties to continue to reside in the same locality. I am however far from convinced that it would be right to give a tenant's landlord the power to seek to evict that tenant for behaviour which, while unacceptable, is not related to his occupancy of the premises. If the behaviour is not directed at a neighbour, I am not sure that the landlord should have such powers. Unless there is a different landlord interest in the behaviour of the tenant, such offences should be dealt with by the police and the courts under general legislation.
As I have said, we are extremely concerned about racial harassment, but we are not yet persuaded that the answer lies in extending the existing grounds for possession. However, if evidence emerges that Ground 2 is not adequate to deal with harassment by tenants of neighbours, we should obviously wish to
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consider our position and see whether there is a sufficient case for changing the law.
5.45 p.m.
Lord McIntosh of Haringey: My Lords, it is clear that the Minister's heart is in the right place; he takes this matter with the seriousness that it deserves and is determined to pursue it. I have sufficient confidence in him to withdraw the amendment on that basis.
I am bound to say however that the evidence that I have been given about the way in which the courts deal with the situation at the moment does not give me confidence that the existing law is good enough. The Minister may find himself forced back into legislation earlier than he would like or than he hopes. Of the cases that have been referred to—and I assume that he is talking about the same cases as I am—in the one case where racial harassment was proved and was shown to be a good reason and where the local authority won the case, the judge noted that words expressly forbidding racial harassment were not found in the Housing Act. Nevertheless he said that in his view racial harassment could well amount to nuisance or annoyance to neighbours. To that extent, the case supports the Minister's argument.
However there are other cases such as Stanley v. Tower Hamlets and Walsh v. Camden where the local authority lost the case. It rather looks as though racial harassment was an issue which the courts felt they could not take into account and where the intentions the Minister is expressing have not been achieved by the existing law. He said that he was prepared to look at future changes to the law. I hope that he will give this all the urgency that the issue deserves.
Of course there are difficulties about defining "Neighbours". The right reverend Prelate the Bishop of Liverpool talked about the difficulty of an "adjacent tenant" as an alternative to "neighbour". I should be very disappointed—worse than disappointed—if we found ourselves with several years of court cases resulting in harassment not being proved because the definition of "adjacent tenant" was not good enough. I should be extremely upset if, as a result of our consideration of this Bill, we allowed something to go through which made the case more difficult for the tenant to prove racial harassment rather than less difficult. It seems to me that that is a possibility if the definition here is changing. I do not know whether the Minister has any more to say on the point about the "adjacent tenant" definition because he did not refer to it in his speech, although the right reverend Prelate did.
The Lord Bishop of Liverpool: My Lords, "adjoining occupier" was the phrase. But it may land the courts in still more trouble.
Lord McIntosh of Haringey: My Lords, I apologise for the wrong wording, but the intention is clearly the same. I am sure that the Minister has heard what has been said and has noted the difficulty with "adjoining occupier". It is possible for a nuisance to be caused by somebody who is not physically adjoining. If the Minister looks at this matter again, I hope he will feel able to come back to us at Third Reading or be

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sympathetic to anything which we may produce at Third Reading.
Lord Tordoff: My Lords, before the noble Lord seeks to withdraw his amendment, perhaps I may through him ask the Minister whether he would also consider giving guidance to voluntary management committees of housing associations and registered housing associations. I raised that point in my intervention.
Lord McIntosh of Haringey: My Lords, I am sure that the Minister will take that point on board as well. This is not a matter which is black and white at all—I apologise, I said that entirely without consideration‡ This is not a matter where all the right is on one side. I am reminded by the noble Lord, Lord Hylton, that it is possible for injustice to be done to the family of somebody who is actually causing racial harassment. If the remedy is in terms of obtaining possession of the harasser's property instead of taking other forms of legal action, the injustice could be on both sides. Clearly we do not wish that to arise either.
I do not underestimate the difficulties of the problem. I think it deserves further consideration and there must be a way of giving it that consideration under the Bill rather than waiting for subsequent legislation. I should like to use the time between now and Third Reading to think about that and discuss it with other people who have more experience of these matters than I have. Meanwhile, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Schedule 2 [Grounds for possession of dwelling-houses let on assured tenancies]:
Lord Stanley of Alderley Lord Stanley of Alderley moved Amendment No.
23:
Page 106, line 20, at end insert—
("Ground 1A
Not later than the beginning of the tenancy the landlord gave notice in writing to the tenant that possession might be recovered on this Ground and—

(a) the dwelling-house was at some time occupied by a person under the terms of his employment as a person employed in agriculture; and

(b) the tenant neither is nor at any time was so employed by the landlord and is not the widow of a person who was so employed; and

(c) the court is satisfied that the dwelling-house is required for occupation by a person employed, or to be employed, by the landlord in agriculture.

For the purposes of this Ground "employed", "employment" and "agriculture" have the same meaning as in the Agricultural Wages Act 1948.").
The noble Lord said: My Lords, I come now to the problem that will be caused by the omission of Case 16 from this Bill. I referred to this at Committee stage and since then I have had correspondence from my noble friend on the Government's view. I am still not clear what that view is; or I am not particularly happy with what I think it is.
Case 16 of the Rent Act 1977 is widely used by farmers who wish to let property to persons
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employed outside agriculture pending possible occupation by an agricultural worker. Whereas under Case 16 only the statutory minimum notice required by the Protection from Eviction Act 1977 has to be given, an assured shorthold tenancy may only just have commenced when some unforeseen event occurs which necessitates repossession for an agricultural worker. The delay could be up to six months. That could be quite a serious matter if the accommodation was, for instance, needed for a cowman.
The National Farmers' Union has, since Committee, conducted a survey of its county branches, the majority of which reported that Case 16 was of considerable importance to farmers and that it was used for the majority of lettings of cottages to those outside agriculture. The Lincolnshire branch, for example, reported that about 300 such tenancies were granted each year in its area. Staffordshire referred to "hundreds". Dorset branch reported that very widespread use was made of the provision and that it frequently assisted farmers in letting tied houses outside agriculture on that basis. I am sure we all welcome that.
Dorset branch also stated that any loss of the provision would have widespread repercussions. This kind of letting is particularly useful for people who are moving from house to house or who need temporary accommodation. Needless to say, my mind immediately focuses on students.
I understand that the Department of the Environment expressed surprise at the extent to which I claimed Case 16 was used. I do not accept that the number of court cases is a good measure of this kind of letting as it is well understood by both parties and seldom leads to disputes. I believe that the department accepts that there will be problems for farmers who have to let for a minimum six-month period and who then need their property back at short notice. It is unreasonable for the Government to suggest that because there may not be many of those cases—I dispute that—they are prepared to cause considerable difficulties and inconvenience for the agricultural community concerned simply because they wish to tidy up the legislation. I think that is probably what the Government have in mind.
I contest also the notion that farmers are no different from other employers who need to house workers in premises convenient for the employment. I need hardly remind my noble friend that farmers are covered—if that is the word—by the Rent (Agriculture) Act, while many other industries are not, and that they may farm in isolated places. I really believe that the retention of Case 16 will lead to more properties on the market. Without it there will be a tendency to leave houses empty, as farmers will be fearful of being able to get them back.
I ask my noble friend to look at this matter again. The ability to get a house back quickly, should it be required, will encourage longer lettings. That is an important point. If Case 16 is not retained, there is a great likelihood that any letting of agricultural houses will be for the minimum six-month period which, I am sure, we would all like to extend. I beg to move.
Lord Hylton: My Lords, I seem to remember co-operating with the noble Lord, Lord Stanley, on some previous Act. I do not remember now whether it was the Rent (Agriculture) Act 1976 or the Rent Act 1977. I believe that the noble Lord has raised an important point. The present system allows for some orderly coping with the fluctuating demand for labour on particular farms. That demand may fluctuate rather more in the future because of changes in systems and because we are, for some commodities, in a state of overproduction and surplus.
I cannot say anything about the drafting of the amendment. It is quite possible that the noble Lord does not have it 100 per cent. right. But, whatever the state of the drafting, I strongly urge the Government to look most carefully at the amendment.
The Earl of Caithness: My Lords, my noble friend raised this matter in Committee, as he told your Lordships, and I subsequently wrote to him about it. Clearly, he was not persuaded by my arguments and, thus, I hope that I shall be able to convince him this time. However, I fear that I might not. It may be, as my noble friend says, that many farmers are letting property which they temporarily do not need for their employees and which they let for long or short periods using the Case 16 to Schedule 15 of the Rent Act on which the ground in this amendment is based.
If they let for short periods, they are probably letting to people on holiday. As your Lordships will realise much rural property is ideal for holiday lets. But they choose to use Case 16 because it is there. If they are letting for long periods, they might contemplate shorthold, but the 1980 Housing Act system of shorthold is not ideal because it is inflexible. However, shorthold under this Bill is extremely flexible and it will be ideal for most lets. It will not be ideal only where unforeseen circumstances arise; for example, where the farmer who has let for six months suddenly finds he needs to house an employee in the property and cannot gain possession immediately. I disagree here with my noble friend. I am afraid I do not see why the farmer in those circumstances is different from any other employer who has let tied accommodation to somebody who does not work for him which he suddenly finds he needs at short notice. The farmer has the benefit of an extra case under the Rent Act at the moment, but of course he does not have the new, flexible system of shorthold.
We do not wish to complicate our legislation by including grounds for possession, particularly mandatory grounds for possession, which are simply not used in court. I am sure your Lordships will appreciate the reasons for trying to simplify legislation, even if we do not always succeed. I do not believe the case for reinstating Case 16 is strong and, as a result, I cannot accept the amendment proposed by my noble friend.
I would however tell my noble friend—if it is any consolation to him—that I have discussed the matter in great depth with our advisers in the Ministry of Agriculture. As a result, they carried out a survey of their regional offices. That followed expressions of concern, not only from myself but also from my
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noble friend and the National Farmers' Union. On the basis of the evidence they were content that we should not replicate Case 16 in the new scheme. We believe that the new shorthold tenancy offers the flexibility that farmers will want. It does not cover the unexpected case, but I find it difficult to justify the fact that farmers alone of those who have tied accommodation should be put in that privileged position.
Lord Stanley of Alderley: My Lords, I knew I would be dissatisfied with my noble friend's reply. I have been rather dissatisfied with him lately. I am sure that the noble Lord, Lord McIntosh, has found my noble friend somewhat inflexible today, if I may say so.
I shall leave the point because I do not wish to push it to a Division. However, I shall repeat two or three points because they may register, if not with my noble friend then perhaps with his department and the Ministry of Agriculture. I repeat that this form of letting under Case 16 really would be to the benefit not just of the farmer who wishes to let—I am not thinking of holiday lettings but of longer lettings—but also to the benefit of the tenant as it would encourage the farmer and the landlord who is letting to let on a longer basis. I am sure we all wish to encourage that.
I am afraid that I must say something about the Ministry of Agriculture. Far be it from me to try to drive a wedge between the Ministry of Agriculture and the Department of the Environment. That is something which my noble friend knows that I would hesitate to do. However, I think that the Ministry of Agriculture is wrong. It bases its case on the fact that there have been no court cases. I do not think that whether there have been court cases is at all a good basis for judging a system. There have not been any court cases, as I said in my submission. That is why I like the system. Yet in one county branch alone, 300 tenancies are granted a year. Is that not a credit for a system? I think that it is a marvellous credit. Of course the Ministry of Agriculture knows nothing about it because there have been no squabbles. I am sure that the Department of the Environment would know but it does not wish to fall out with the Ministry of Agriculture.
I believe that the Minister is slipping up on that point. I shall withdraw the amendment although I am sorry to withdraw it. I hope that I have made my point. I beg leave to withdraw the amendment.
6 p.m.
Baroness Phillips: My Lords, before the noble Lord withdraws his amendment perhaps I may ask the Minister one question. He referred to lettings to students as did the noble Lord, and to holiday lettings. The only reference to either of those which I can find in the Bill is to holiday lettings:
"A tenancy the purpose of which is to confer on the tenant the right to occupy the dwelling-house for a holiday".
That does not say for how long, and is totally inadequate.
I have been waiting for an opportunity to raise the problem of some scandalous cases in London and

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elsewhere which I have found out about from nurses, cases of people living in so-called holiday lets, unprotected by any kind of legislation and treated disgracefully. A holiday let gives the right to occupy the dwelling-house for a holiday. How long is a holiday? It is rather like asking, "How long is a piece of string?"
I do not think that the Minister can necessarily give me an answer now, but at some stage I shall be raising some of the quite appalling cases which have been brought to my notice. I should like to know what constitutes a holiday let.
The Earl of Caithness: My Lords, with the leave of the House, I point out to the noble Baroness that we shall he coming to this subject later. The point was raised in Committee and I sympathised with the point she made. I believe that it was the noble Lord, Lord Ross of Newport, who said that it was quite a good idea and I referred to the problem in London at that time.
Amendment, by leave, withdrawn.
[Amendment No. 24 not moved.]
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 25:
Page 108, transpose lines 13 to 24 to end of line 26.
The noble Lord said: My Lords, I am rather proud of Amendment No. 25. It is the first time that I have got the word "transpose" into the instructions for an amendment. Amendment No. 25 concerns the distinction between the two different sets of grounds for possession which are provided in Schedule 2. One relates to mandatory grounds for possession and the other to discretionary grounds for possession. Very simply, the amendment takes the three months' rent arrears ground from the mandatory grounds for possession and puts is into the discretionary list. In other words we are seeking to give the courts the power, if they see fit, to find some other solution than possession for the problem of rent arrears—in this case the problem of three months' rent arrears.
On the face of it this may not seem to be a provision which benefits landlords. I would argue quite strongly that our amendment does benefit landlords. The landlord's interest after all is in getting his money back and having a secure tenant. However, there are all kinds of cases in which the tenant may have fallen into three months rent arrears for reasons which could be rectified. I gave one example when I talked about non-tenant spouses.
If a husband and wife or two people are living together and one of them, the husband let us say, leaves, he may make an informal arrangement to continue to pay the rent. That seems the responsible thing to do. When he has gone away he may find that he does not want to carry on doing so. The situation does not yet involve a maintenance order: that would take far too much time and could well take more than three months, which is the period which results in mandatory possession. In the meantime the wife who has been left behind may not realise that the rent has not been paid because she accepted her husband's undertaking that he would continue to pay the rent. She finds that the rent has not been paid, but too late
1410
to do anything about it. By that time possession has been obtained and the landlord has the property back. The courts have no power to intervene.
As I said in debating the earlier amendment, under the Matrimonial Homes Act a non-tenant spouse has a number of rights. The person left behind could take over the payments and having taken over the payments could make application to take over the tenancy.
Is it not in the interests not just of the tenant and of society but also of the landlord for the courts to have the discretion to make that possible? At the moment the courts do not have that discretion, and those circumstances would provide mandatory grounds for possession. It means that the only action the landlord can take if he wants to go to the courts is to possess the premises and force a family—because that is what it will be—on to the streets, into accommodation for the homeless, or the tender mercies and limited resouces of the local authority.
We believe that the courts should have discretion in such cases. We think that the wisdom of magistrates in these matters is very considerable, as is their experience of family life and landlord and tenant relationships. We believe that we should take advantage of that experience and wisdom and give them the discretion that we know they want and believe they deserve. I beg to move.
The Earl of Caithness: My Lords, I am afraid that we are on a collision course again. The amendment is clearly against everything that we are trying to do to free the market: the noble Lord, Lord McIntosh, is trying to put landlords back into handcuffs.
We regard it as self-evident that landlords will not be prepared to make accommodation available for letting unless it is commercially attractive for them to do so. As the noble Lord will be very well aware, one of the things to which all landlords attach the greatest importance is that the tenant should pay his rent on time. One of the features of the Rent Act which provokes constant complaint from landlords is that tenants are able to delay paying rent and allow substantial arrears to build up with impunity in the knowledge that only in the most extreme cases will the courts agree to grant possession. If we are to encourage landlords to come into the market it is essential that we provide an adequate statutory mechanism to deal with the rent arrears problem. That is what Ground 8 is designed to do.
Ground 8 requires the court to grant possession in a case where the tenant is, broadly speaking, three months in arrears with the rent both at the date on which proceedings are begun and at the date of the court hearing. It has been asserted that this is too harsh on the tenant, particularly in circumstances where the rent arrears might not be regarded as the tenant's own fault. We do not accept that view. In practice it would usually take some six to eight weeks for a case to come to court. Thus, if the landlord is to succeed, the tenant may well be up to four or five months behind with the rent. It seems entirely reasonable that in such a case a landlord should have an automatic right to possession.

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Where a tenant is faced with an action for possession on Ground 8, he only needs to pay, before the date of the court hearing, whatever amount will bring the arrears below three months. Once he has done this, the ground will no longer apply. However, where it does apply, it seems to us essential that it should do so on a mandatory basis. To make the ground discretionary as the noble Lord has proposed would place the landlord in exactly the same position of uncertainty as has caused so much difficulty and resentment under the Rent Act.
The noble Lord's amendment is thus quite incompatible with our objective of striking a more equitable balance between the interests of the landlord and the tenant.
Lord McIntosh of Haringey: My Lords, I believe that we are once again in one of those positions in which the Government have one stereotype of the wicked tenant not paying the rent and are accusing us of having another stereotype of the wicked landlord harassing the tenant and trying to drive him out.
I reject the supposition that we have the stereotype but I fear that the Government cannot produce any evidence that they are not stereotyping tenants. There are different cases. There are those in which tenants fail to pay the rent, not just because they cannot afford to do so but because they think that they can get away with not paying for a considerable period of time. It is not unknown for tenants to disappear owing considerable amounts of rent. Nobody wants to defend tenants who do not meet their financial obligations or who take unfair advantage of the opportunities provided by the state to obtain help with the payment of rent. We do not put forward such a proposition.
We are not guilty of the stereotyping of which we are accused. We believe that it should be left to the magistrates' court to make a decision, not that it should be mandatory upon the court to grant possession. I gave an example, which I recently expanded, of a case in which a tenant may have left home, leaving the non-tenant spouse who may not know that the rent has not been paid. The Minister seems to think that because the tenant is informed that court proceedings are in the offing, that gives the non-tenant spouse the opportunity to make good the arrears. However, the non-tenant spouse may not have the financial resources to do so. It may take her longer to obtain housing benefit than the time given to appeal to the local authority. Another possibility which the Minister has not considered is that the person who is left behind may simply forward letters from the landlord to the tenant, which is a perfectly proper proceeding. It would mean, however, that the person left behind, who will be dispossessed on a mandatory basis, may not even know that the court case is coming up. That is our difficulty.
The Minister has taken a rigid view and is not allowing the court to take any view whatsoever. I cannot believe that that is just or that it is a proper reaction to the uncertainty which the Minister described as the effect of the Rent Acts in the past. Surely he has more confidence in the ability of magistrates to make a distinction between defaulting tenants who deserve to be dispossessed and those
1412
whose default is not of their own making and who deserve consideration. The views of magistrates should be taken into account. They should be given an opportunity to express those views and see them reflected in the way in which they reach decisions. I cannot believe that as a whole magistrates will frequently come down wrongly on the side of tenants against the landlord.
I am disappointed in the Minister's response. I do not think that there has been any progress in his thinking since the Committee stage. As it is clear that he will not proceed any further, I think it better to beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 26 not moved.]
Clause 8 [Notice of proceedings for possession]:
[Amendment No. 27 not moved.]
6.15 p.m.
Lord Graham of Edmonton moved Amendment No. 28:
Page 7, line 10, leave out ("that ground is") and insert ("both that ground and particulars thereof are").
The noble Lord said: My Lords, in moving Amendment No. 28 in the name of my noble friend I should like at the same time to speak to Amendments Nos. 29 and 32. We hope that the Minister will not only acknowledge our intentions but also reflect that they are based on what his noble friend Lord Hesketh said when comparable amendments were moved at an earlier stage.
We are concerned about the miserable circumstances and atmosphere that must build up when repossession is due to take place. Frankly we want to be as fair as possible to both the tenant and the landlord. We are well aware of people who quote standing orders. One often hears the words, "Suspend standing orders" and has to say, "Tell us which one it is". One needs to be given more information than what is stated in Schedule 2 about the grounds on which the court can grant a possession order.
The Minister will recall that during the Committee stage his noble friend Lord Hesketh said that the Government would bring forward an amendment at Report stage which would require the notice to state,
"not only the ground on which possession is sought, but also the details—for instance, how much rent the tenant is alleged to owe, which obligation of the tenancy he is said to have broken, and so on". [Official Report, 21/7/88; col. 1579.]
I am sure the Minister and his advisers will recall that statement. No Minister would speak more fulsomely than the noble Lord, Lord Hesketh, without having some idea of putting flesh on the bones at a later date.
We are very concerned about alleged rent arrears as the ground for possession. We want to be fair to the tenant. We believe that the tenant should not only be made fully aware of the amount of the arrears but also that the landlord should furnish the dates on which the arrears took place because that can have a material bearing on the ability of the tenant to persuade the landlord not to proceed. For instance, as we are all well aware, many tenants rely either

1413
upon the receipt of moneys from another source or on payments into the landlord's bank account by agencies of the state, for example, the DHSS. When the arrears which are the basis on which the possession order is sought are ultra vires—that is to say, beyond the powers of the tenant to affect since he has been let down because of non-receipt by the landlord of the payments which the tenant in his or her innocence thought were being made—we believe that a reasonable landlord should recognise that fact and not be as punitive as he otherwise might be.
We understand how breaches of a tenancy agreement can be grounds upon which possession is sought. However, we do not want the ground merely to be cited: the specific details on which that ground is pleaded in aid by the landlord should also be mentioned. For instance, if the ground is persistent delay in the payment of rent, the tenant is entitled to have some indication of it.
There is a great deal more that I could say about this subject, and 1 intend to say it if we do not receive a satisfactory answer. I ask the Minister to face head on the question of how he will put flesh on the bones of the promises made by his ministerial colleague at an earlier stage. We do not want to hear from him that these are matters that can be dealt with by reasonable men and women on both sides of the fence, each understanding the other's problems.
These amendments are not designed to be either punitive upon the landlord or draconian to the tenant. There are many circumstances to be taken into account. In Amendment No. 32 we seek to have set out the precise details.
We are also very much concerned with the period of time covered by the notice. In Amendment No. 32 we want the dates specified. Instead of the period of notice being two weeks, we want it to be two months. We think the time is needed by the tenant in order to get his defence together. We are not talking simply about taking possession of a chattel or a transfer of money. We are talking of people who may be living in desperate circumstances. What little security that they possess may be taken away for them in some instances by virtue of circumstances over which they may be able to prove that they have no control. I beg to move.
The Deputy Chairman of Committees (Lord Alport): My Lords, I have to advise your Lordships that if Amendment No. 28 is agreed to I shall not be able to call Amendment No. 29. I have also to advise your Lordships that the name of the noble Lord, Lord McIntosh of Haringey, is wrongly included in support of Amendment No. 29.
The Earl of Caithness: My Lords, how disappointing‡ I had believed that we were in harness together on these amendments. We have here several amendments with a common aim. We had always intended that the details of the ground on which a landlord is seeking possession should be set out in the prescribed form which he will have to use. However, both Amendments Nos. 28 and 29 would make it clear on the face of the Bill that this will be the case. When the ground is set out in full in the notice, the
1414
position will be clear to the tenant. It would be unreasonable to expect him to know what the numbers in Schedule 2 are supposed to mean. Many people are confused by forms, and prose is often better than numbers.
Amendment No. 28 and government Amendment No. 29 have therefore the same effect. I trust that the noble Lord, Lord Graham of Edmonton, will not mind if I suggest that we choose the wording offered by the parliamentary draftsman. I hope that he will withdraw Amendment No. 28 and not move Amendment No. 32, which sets out matters which I can assure the House will be set out in the prescribed form itself and which it is not necessary to specify on the face of the Bill. I can assure your Lordships that government Amendment No. 29 achieves what both sides of the House want.
Let me add this on the information required on court forms, a point which the noble Lord, Lord Graham of Edmonton, raised. The Lord Chancellor's review of civil justice concluded that court forms should be revised to require more detailed information of the sort that the noble Lord mentioned when he moved the amendment. We believe that revision of the court forms is already in hand.
Lord Graham of Edmonton: My Lords, the Minister is satified in substance that what I have sought to write on the face on the Bill in Amendment No. 32 will not be required because he knows precisely what will be on the prescribed form. I do not. Those outside the House do not. I am prepared to say that we shall rest content. The Minister is an honourable man. If he assures us that what we feel is required will be on the form issued, then we can also agree with the Minister that there is no need to write that on the face of the Bill. I am very happy with the information that he has given, and on that assurance I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Earl of Caithness The Earl of Caithness moved Amendment No. 29:
Page 7, line 10, leave out ("is") and insert ("and particulars of it are").
On Question, amendment agreed to.
Lord Graham of Edmonton Lord Graham of Edmonton moved Amendment No. 30:
Page 7, line 21, leave out ("weeks") and insert ("months").
The noble Lord said: My Lords, Amendments Nos. 30 and 31 relate to periods of notice. In dealing with proceedings, subsection (3) (b) states that those proceedings,
"shall not be earlier than the expiry of the period of two weeks from the date of service of the notice".
In this amendment we are suggesting that two weeks is an inadequate period of time for the people who are affected to prepare themselves. As the Minister knows, we have questioned this aspect. The Minister is satisfied that the tenure represents a high degree of security of tenure. However, we have given evidence throughout the stages of this Bill that that is not the case. In the circumstances that I have outlined earlier

1415
and of which the Minister and his colleagues are well aware, two weeks to prepare to defend the case that the landlord may seek to make is very unreasonable.
The grounds about which we are talking include those of the three months' rent arrears, any rent in arrears, and persistent delay in paying rent. In our view those grounds require a longer period than two weeks for the tenant to be able to prepare his case. Assured tenants would then be subject to two months' notice. The Minister will not need me to draw his attention to other aspects of the Bill and other housing legislation in which the period of two months rather than two weeks appears frequently. We seek to avoid confusion and misunderstanding. It is of paramount importance that when the notice is given there should be adequate time for the defence to be prepared.
Those people who will be subject to a notice of an appearance in court, even with a period of two months, will be very frightened people. We know that there are rogues in all walks of life. We know that there are those who will abuse generosity of spirit as well as liberal interpretation of the law. However, we ask the Minister to recognise that two weeks is too short a period. He may say that two months is too long. I shall be interested to hear what he has to say. Perhaps he will suggest a period of six weeks. I beg to move.
The Earl of Arran: My Lords, quite frankly it would not even be tempting to try to accept the compromise of six weeks that the noble Lord, Lord Graham, puts forward. Perhaps I may try to persuade your Lordships' House that two weeks is reasonable.
Where a landlord wants to obtain possession of accommodation let to an assured tenant he must give notice of his intention to seek possession on one of the grounds in Schedule 2 to the Bill. Clause 8 provides that under certain grounds the landlord must give at least two weeks' notice of his intention to start proceedings and under others at least two months' notice. There is the additional requirement in the two-month ground cases that the period of notice must not he less than that which, but for Clause 5, would have been required under the common law rules on notice to quite. The effect of these amendments is that a landlord would have to give at least two months' notice in every case.
The grounds under which a landlord has to give only two weeks' notice are of two kinds. Most are "fault" grounds; that is, they apply where the tenant has misbehaved in some way. For instance, he may have failed to pay the rent, or damaged the property, or caused a nuisance to neighbours. In these circumstances it seems entirely unreasonable to expect the landlord to give as much as two months' notice, especially bearing in mind that it may take quite some time for the case to come to court once the proceedings are begun.
The second category of ground to which the two-week period applies is out-of-season or out-of-term lettings of holiday or student accommodation. Where a holiday cottage, for instance, has been let during the winter on a fixed-term tenancy and the landlord, having given the appropriate notice at the start of the
1416
tenancy and the fixed term having expired, wants possession for the beginning of the season, it would be absolutely unreasonable to expect him to wait for two months before starting proceedings. The same is true where an educational institution has let student accommodation on a fixed term tenancy out of term. If it has to give two months' notice, where will the returning students live? I hope that the noble Lord, Lord Graham of Edmonton, will find these arguments persuasive and with that in mind will agree to withdraw his amendment.
Lord Graham of Edmonton: My Lords, the Minister has been reasonable bordering on the persuasive. That is as far as I shall go. He clearly draws the distinction and differentiates between the various grounds. I readily understand the impossibility in some circumstances if a longer period of intent had to be served. But the Minister and his advisers always err on the side of the landlord and assume that in every case the landlord, even when he has a benefit, in seeking to protect his interests is up against individuals whom the court may later find innocent. It is the petrifying worry that so many people feel in the circumstances under the ground of two weeks' notice.
We were seeking consistency and a lack of confusion in this matter. I know the Minister may say that we can bring all periods of notice down to the shorter time, but I am not seeking that. To be honest I take the view that the overwhelming majority of people living in this kind of accommodation, however good their relationship with the landlord, are not living in the best of circumstances. There are few individuals who deliberately seek to live in the kind of ambiance and environment in which they are subject albeit to the protection of the law but needing the protection of the law to that extent.
I am grateful to the Minister for the care he has taken in giving an answer which we shall read with care. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 31 and 32 not moved.]
Clause 9 [Extended discretion of court in possession claims]:
[Amendment No. 33 not moved.]
6.30 p.m.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 34:
After Clause 12, insert the following new clause:
("Prohibition of premiums etc.
Any person who, as a condition of or in connection with the grant, renewal, continuance or assignment of an assured or an assured shorthold tenancy, requires or receives, in addition to the rent, the payment of any premium, or requires the making of any loan (whether secured or not) shall be guilty of an offence.").
The noble Lord said: My Lords, in moving Amendment No. 34 I speak also to Amendment No. 35. With these two amendments we return to the question of premiums or, as they are usually known, key money. We find ourselves in an extraordinary position. The Housing (Scotland) Bill had similar provisions to this Bill. It allowed premiums to be charged. The Government introduced amendments

1417
to the Housing (Scotland) Bill to outlaw premiums. Yet when the same reasonable proposal is made for England and Wales, they seek to argue that premiums or key money are perfectly acceptable in this country. The Government's argument is based on a myth. The myth is that negotiations between landlord and tenant, and particularly between landlord and prospective tenant, are fair negotiations on fair terms where the cost of the premium to the tenant can reasonably be set off against the possibility of a lower rent.
As anybody who has seen anything of negotiations between landlord and prospective tenant will know, the prospective tenant has everything to lose and the landlord has only the possibility of loss of a week's rent before he finds another tenant for his property. The idea that a higher premium will be charged because a lower rent will be charged subsequently is in the realms of fantasy. It does not happen and there is no reason to suppose that it would happen in the future.
There are two basic reasons why we are opposed to key money. The first is that it loads the dice against prospective tenants (particularly those most in need) far more than can be justified. Let us take an example of somebody moving to a town having found a job and desperately needing accommodation to do that job, having done what Mr. Norman Tebbit describes as getting on his bike and finding work away from home. That is not an ideal or happy situation at the best of times. He is almost certainly likely to find himself without any money. He will almost certainly have to borrow to pay even the rent that might be required in advance. If he has to pay a premium as well, the risk will be that he will start his job in his new place of work and new home seriously in debt because of the sheer greed of a landlord wanting not only the rent he can reasonably obtain but also charging a premium.
That goes against everything that the Government have said about the mobility of labour and is against all the arguments there should be in favour of a free and equitable private sector market. If the private rented sector does not provide the flexibility that we are seeking in these amendments, it is not performing the social function which I thought the Government wished it to perform and it is not justifying the substantial financial concessions being made in the Bill to the private rented sector.
Secondly, we are opposed to key money because of housing benefit. Housing benefit is payable on rent, although we shall come on to the inadequacies of the Bill in that respect when we deal with Part V on Thursday. The main grievance we have, and the particular injustice represented in the Bill, is that, even if the housing benefit were to meet all the rent and the local authority is reimbursed for the housing benefit up to the level of the rent and not simply the rent as assessed by a rent officer or what the Government are prepared to provide, housing benefit cannot and will not cover the cost of premiums. Therefore those in most need will be deprived of the opportunity to live in private rented accommodation because the landlord may choose to keep them out.
1418
Landlords would prefer to have rich tenants. They would prefer to have people who can pay their own rent rather than people who have to rely on housing benefit. The result will be that private rented accommodation will be a selective service keeping out those in most need because housing benefit will not cover the cost.
In those circumstances, can it seriously be argued that in England and Wales but not in Scotland premiums are legitimate? They have been outlawed in this country for many years. It has never caused any difficulty for them to be outlawed except when the law has been broken and the courts have had the responsibility for dealing with that. They are a distortion of the free negotiation between landlord and tenants and they ought not to be allowed. I beg to move.
Lord Pitt of Hampstead: My Lords, I wish to support my noble friend on this amendment. The reintroduction of premiums is a blot on the Bill. Your Lordships know that I have much criticism of the Bill in many respects, particularly in the way I am afraid it will increase homelessness, but on this occasion I am concerned about its effect on mobility. If a chap finds a job in a new area he will not have key money. He will have no money to pay a premium. On the other hand, we want him to be able to move into the area and find a house so that he can start his job, pay rent, establish his family, get off welfare and so on. To allow a landlord to insist on a premium is to put an obstacle in the way of the mobility which the Government desire.
I should like to appeal to the Minister to rethink this matter. I believe that in agreeing to the reintroduction of premiums the Government are taking a very slippery road, a road which will put the maximum amount of difficulty in the way of achieving one of their objectives—that of increased mobility.
The Lord Bishop of Liverpool: My Lords, I hope that the Minister will respond with some seriousness to this particular issue. The exhortation of Mr. Tebbit has been mentioned already. It is now part of Liverpool folklore that the Tebbit Express travels every Friday from London to Liverpool and every Sunday night and Monday from Liverpool in the reverse direction. That happens from many cities—an extra train on Monday morning and several extra trains back on Fridays.
Those young people from our city represent many who can easily be at the mercy of a harsh market in London. To put them in this position will add to the serious dangers for young people. As stated by the noble Lord, Lord McIntosh, many of them may begin their working life having moved away from home when they did not want to. That they should begin in debt is another serious barrier in the way of making a good start. I hope very much that in the interests of establishing a better rented market the Government will wish to make sure that a modest level of rents is possible. This seems to me to be one of the least helpful parts of the Bill.
6.45 p.m.
The Earl of Caithness: My Lords, we discussed the subject of premiums at some length during Committee stage. I am not sure that there are any major new arguments waiting to be deployed on either side. Certainly, I did not hear any from noble Lords opposite or the right reverend Prelate. I am sure that they will say much the same of me when I have completed what I have to say.
The amendments proposed by the noble Lord are modelled very closely on the provisions in the Rent Act which prohibit the charging of premiums in respect of protected tenancies under that Act. The reason for the existence of those provisions is quite clear. A ban on premiums is a logical, indeed essential, feature of any system of statutory rent control. Without the ban a landlord would be free to require the payment of a capital sum as a means of circumventing the restrictions imposed on the actual rent. It is, I think, generally accepted that many landlords have succeeded in getting round the prohibition, but that is not the point of my argument.
The key objective of Part I of the Bill is to do away with the concept of statutory rent control and to give landlords the freedom to charge a genuine market rent. They will therefore no longer have any need or incentive to resort to devices such as premiums in order to compensate for artificially low rents. A landlord might wish to require the payment of a capital sum in consideration for the grant of a tenancy, although there is no reason to think that this will be common practice. But where a premium is charged, the effect must surely be, in a free market, to depress the rent below what would otherwise been payable. That is a principle which has long been working quite satisfactorily in the market for commercial tenancies and long residential leases, and I see no reason why we should object to it in the present context.
The noble Lord, Lord McIntosh of Haringey, said that to expect a lower rent as a result of a premium would be a fantasy. I have to say to the noble Lord that from my experience in the commercial field the letting market is very restricted under the present Rent Acts. The private rental market is down to some 8 per cent. from over 50 per cent. before the last war. It is not surprising that the Labour Party has to insist on having no premiums. However, where one does have a free market in rented property, as in the commercial world, the payment of a premium leads to a lower rent. I should like to say to the noble Lord, Lord McIntosh of Haringey, that his use of the word fantasy is perhaps inappropriate when one creates the free market that one wants to create, thereby increasing the number of landlords and opportunities available to tenants.
To impose a prohibition on premiums would make no sense within the framework of the regime we are establishing with this Bill. The freedom to charge a premium is simply a logical consequence of the free market approach. Moreover, quite apart from the issue of logic, and ban on premiums would give rise to major technical difficulties and complications in relation to long residential leases and also housing association shared ownership schemes.
1420
I urge your Lordships to accept that, if we can only leave emotion on one side, there are no arguments of principle or practice for a prohibition on premiums under the new regime. I am not overlooking the fact that the ban on premiums was accepted in the Housing (Scotland) Act. As I said at Committee stage and now repeat, legal and historical differences seem to us to justify a divergence of approach on premiums north and south of the Border.
The noble Lord, Lord McIntosh, also raised the question of housing benefit. It is true that housing benefit is not payable on premiums. But I would have thought that that is unlikely to put tenants who are dependent upon housing benefit at a disadvantage. The noble Lord will know that the proportion of private tenants claiming benefits is so great that many landlords could find that their choice of tenants was severely restricted if they insisted on premiums.
If we can improve the letting market, as we intend to do by this Bill, and increase the choice, then I am sure that we will arrive at a situation where, if somebody pays a premium, a lower rent will result.
Lord Pitt of Hampstead: My Lords, will the noble Earl not agree that although in a market where there is adequate or almost adequate housing the question of a premium will not be a serious matter, in a market such as the present one, where there is a great shortage in certain areas—the very areas into which the Government wish people to move because of the job situation—the allowance of a premium will create great hardship? Will it not therefore be better at this stage to allow the existing ban on premiums to remain and to be prepared to remove it later when the provision of rented accommodation is such that its presence could he claimed to be distorting the market? Its removal would then be helpful. Does the Minister not agree that, in view of the present shortage, a premium is going to be a handicap?
The Earl of Caithness: My Lords, I agree with the noble Lord that in some areas of the country there is a shortage of property and that in others there is a surplus. That happens to be one of the facts of life. It varies from area to area. I do not agree with the noble Lord's philosophy of trying to put no premiums on those areas where there is a shortage of supply. It is exactly to those areas that we will be encouraging people. They will go of their own accord, without further encouragement from the Government, in order to provide rented accommodation now that we are to free them to do so.
Lord Pitt of Hampstead: My Lords, with respect, the noble Earl has misunderstood. I am not suggesting that there should be no ban in one area and a ban in another. I am suggesting that we keep the existing ban and then, when rented accommodation becomes adequate or almost adequate, we remove it.
Lord McIntosh of Haringey: My Lords, the Minister anticipated in his reply that we would be dissatisfied with his arguments and his answers. That is certainly the case. He started with a completely false analogy in order to reach a completely false conclusion. The false analogy was based on

1421
commercial property, of which he has far more knowledge than I have, where I would have thought the distinction was that leases are granted for a period of years and that as commercial rents go up those leases start to have a value and that value is reflected, on the assignment of the lease, by a premium.
That may be something which one can well understand in commercial terms but which has no relevance whatever to the housing market so far as I can see, unless the Minister is talking about those very few rented properties, almost certainly always in London, which are let on a very long residential lease for a commercial rent. If there are more than a few thousand of them in the country I would be very surprised. It is certainly a bad basis on which to allow a revival of key money in our housing law.
The Minister made virtually no reference to the most important point of all, housing benefit. It is even worse than I indicated in introducing the amendment. It is not just that housing benefit, as he has confirmed, is not payable on the premium but that the Secretary of State has actually ruled that the social fund, which is supposed to be the long stop, the safety net for our social security payments, will not be used in order to pay premiums. In other words, he is saying that a very high proportion of people in the worst financial and housing need—and he confirmed this by what he said about existing private tenants—will be denied access to private rented accommodation. That means to say that private rented accommodation is not even intended in the Government's mind to fulfil an adequate role in the total range of housing policy in this country.
That is the inescapable conclusion from what the Minister is saying, because we are only talking about a private rented tenancy. Nobody is suggesting that local authorities are going to charge premiums and nobody so far as I know is suggesting that housing associations are going to charge premiums. However, that is not quite true. The Minister appeared to suggest at one stage that housing associations would charge premiums, but the head of the regulation and monitoring division of the Housing Corporation does not think so. When she was asked whether housing associations should be charging premiums—she was speaking at the National Federation of Housing Associations Conference in York on 24th September—she said:
"They cannot and they must not".
So it is only the private rented sector which is going to charge premiums, and we are saying that if we do not ban premiums now the private rented sector is not going to be available to any but those who can afford the full rent from their own resources. That is a distortion of social policy, and it ought not to be allowed.
6.53 p.m.
On Question, Whether the said amendment (No. 34) shall be agreed to?
Their Lordships divided: Contents, 34; Not-Contents, 88.

DIVISION NO. 4

CONTENTS

Alport, L.

Mclntosh of Haringey, L.

Carmichael of Kelvingrove, L.

McNair, L.

Cledwyn of Penrhos, L.

Mar, C.

David, B.

Meston, L.

Dean of Beswick, L.

Milverton, L.

Dormand of Easington, L.

Nicol, B. [Teller.]

Ennals, L.

Pitt of Hampstead, L.

Ewart-Biggs, B.

Ponsonby of Shulbrede, L. [Teller.]

Galpern, L.

Glenamara, L.

Rochester, L.

Graham of Edmonton, L.

Stewart of Fulham, L.

Houghton of Sowerby, L.

Stoddart of Swindon, L.

Hylton, L.

Taylor of Blackburn, L.

Irving of Dartford, L.

Taylor of Gryfe, L.

Kilbracken, L.

Underhill, L.

Kinloss, Ly.

Walston, L.

Liverpool, Bp.

Williams of Elvel, L.

Lockwood B.

NOT-CONTENTS

Ailesbury, M.

Home of the Hirsel, L.

Alexander of Weedon, L.

Hooper, B.

Ampthill, L.

Hylton-Foster, B.

Arran, E.

Johnston of Rockport, L.

Auckland, L.

Kaberry of Adel, L.

Belstead, L.

Killearn, L.

Bessborough, E.

Kinnoull, E.

Blatch, B.

Lauderdale, E.

Borthwick, L.

Lindsey and Abingdon, E.

Boyd-Carpenter, L.

Long, V. [Teller.]

Brabazon of Tara, L.

Lucas of Chilworth, L.

Broxbourne, L.

Lurgan, L.

Caithness, E.

Lyell, L.

Cameron of Lochbroom, L.

Margadale, L.

Campbell of Alloway, L.

Marley, L.

Carnock, L.

Merrivale, L.

Cathcart, E.

Mersey, V.

Chelmer, L.

Monk Bretton, L.

Coleraine, L.

Monson, L.

Colnbrook, L.

Munster, E.

Constantine of Stanmore, L.

Nelson, E.

Cox, B.

Newall, L.

Craigavon, V.

Orkney, E.

Craigmyle, V.

Orr-Ewing, L.

Croft, L.

Oxfuird, V.

Davidson, V. [Teller.]

Pender, L.

Denham, L.

Reay, L.

Donegall, M.

Renton, L.

Elliot of Harwood, B.

Rodney, L.

Elliott of Morpeth, L.

St. Davids, V.

Fairfax of Cameron, L.

Saltoun of Abernethy, Ly.

Faithfull, B.

Sanderson of Bowden, L.

Ferrers, E.

Sharples, B.

Fortescue, E.

Skelmersdale, L.

Gardner of Parkes, B.

Stanley of Alderley, L.

Gibson-Watt, L.

Strathclyde, L.

Hailsham of Saint Marylebone, L.

Swinfen, L.

Trafford, L.

Halsbury, E.

Tranmire, L.

Harmar-Nicholls, L.

Trefgarne, L.

Harvington, L.

Trumpington, B.

Henley, L.

Vaux of Harrowden, L.

Hesketh, L.

Waldegrave, E.

Hives, L.

Whitelaw, V.

Resolved in the negative, and amendment disagreed to accordingly.
[Amendments Nos. 35 to 39 not moved.]
The Earl of Arran: My Lords, I believe that this is a convenient moment to break for dinner. I therefore beg to move that the House do now adjourn further consideration on Report until 8 p.m.
Moved accordingly, and, on Question, Motion agreed to.
[The Sitting was suspended from 7.3 to 8 p.m.]
Clause 17 [Succession to assured periodic tenancy by spouse]:
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 40:
Page 13, line 2, at end insert ("unless the tenant succeeded a spouse").
The noble Lord said: My Lords, in moving this amendment I speak also to Amendments No. 41 and Nos. 105 to 111 inclusive. All these amendments relate to succession rights—the right of a relative who is not a spouse to succeed to the tenancy if that person has lived with a tenant for a given period of time.
Amendments Nos. 107, 108, 110 and 111 propose that instead of the period being two years, as it is in the Bill, it should be a period of one year. Amendments Nos. 105 and 106 seek to ensure that where a non-spouse relative (there must be a better phrase than that) succeeds after the death of a Rent Act statutory tenant the succession will be to the same kind of tenancy and not an assured tenancy as presently proposed.
Amendment No. 109 seeks to ensure that where there is a second successor the second successor can have been resident either with the first successor or with the original tenant, but not necessarily both as is proposed in the Bill.
These amendments, in common with other amendments, seek to preserve some vestige of the protected tenancy regime. We are well aware of the ideological position of the Government. We know that the Government are seeking deliberately to abandon the protected tenancy regime in order, as they say, to throw open the housing market, and particularly the private rented housing market, to the market place. That is the Government's political stance and we are not seeking, at this stage at any rate, to take issue with the Government. We are seeking to draw attention to the needs of certain groups in the community who we believe will be particularly badly hit by this change and to seek the Government's understanding of the issues with some recognition that such groups need protection in this period of change.
If the Government were to say that these amendments are acceptable in principle but could be adopted only for a period of so many years, we should understand that. The Government would still he achieving their objective of moving towards a more market-oriented regime for private rented accommodation. In the meantime, we seek to persuade the House that there will be substantial hardship which could and should be avoided.
I deal with the amendments perhaps not in the right order but in the order that I have them, and I hope that will not cause any difficulties. Amendments Nos. 107, 108, 110 and 111 all propose that the successor—that is, the non-spouse relative who should have the right to succeed to the tenancy on a tenant's death—should need to have lived with the tenant for only one year rather than the two years in the Bill. To an extent, all these periods are arbitrary. The Government started off with a period of five years which on consideration they reduced to two years. If we take the test that it should be a matter of
1424
whether the new tenant is entitled to consider the property as home, the definition of a shorthold tenancy is six months—and presumably a shorthold tenant is one who is entitled to consider his house as a home.
There is no one right solution. However, we suggest that a period of living with the tenants for two years is excessive, particularly when someone goes in to care for elderly tenants, which must be a very common situation. The critical consideration is that someone who decides to live in with and care for a tenant is giving up his or her own home in order to do so. In that case a compromise period of one year is surely not unreasonable. It could make it easier for carers to live with their parents and not feel that they are throwing themselves upon the mercy of the housing market but are having their future looked after.
That seems to us to be entirely reasonable. After all, it is public policy—this is not a party political matter—to encourage community care rather than hospitalisation. If that is to be achieved there must be a system whereby people who undertake this community care, which often means moving in with the people who need care, should have their own housing needs looked after. It will not be expensive for the Government and should not cause any serious difficulty for landlords. It would relieve the minds of many people who are concerned about this matter.
Amendments Nos. 105 and 106 concern the kind of tenancy which will be succeeded to. The Bill states that if the carer—I will keep to the example of a carer but clearly there could be other examples—goes to live with a tenant and to care for that tenant the tenancy afterwards should be of the same regulated kind as the tenant had rather than an assured tenancy with the prospect, inevitably, of higher rent levels and less security of tenure.
Amendment No. 109 deals with second successions, to which I have already referred. Under the Bill, in order to become a second successor a person must live with both the first successor and the original tenant. That could be very damaging for family life. For example, there could be a male tenant with a wife, both elderly, but the wife is also disabled. If the husband dies the wife will succeed to the tenancy but be even more incapable of looking after herself without her husband. In those circumstances another relative, who would be called the second successor, will move in. Under the Bill, unless the second successor moved in before the original tenant died, that second successor would have no right of succession. That does not seem to us to be right and does not accord with the desire of the Government, and all of us, to maintain family life and the responsibility that we hope to have for our parents,. which we hope our children will have for us and which we hope we have for our children.
Again we believe that a modest concession to change the stipulation to either having lived with the original tenant or having lived with the first successor, but not both, would relieve much potential suffering and at the same time would not cause a great deal of difficulty.
I come back to the original Amendment No. 40, relating to Clause 17, which I should have dealt with

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first. We think this amendment is even less controversial than the others. The Bill already makes provision for succession by the spouse of an assured tenant but does not make provision for what happens if the spouse then remarries and the successor later dies. That means that the new spouse will be evicted. That means that although in theory spouses have succession rights the fact that it happens at one removed, so to speak, means that those succession rights become extinct. Again the principle of a spouse succeeding to the tenancy in the family seems to be destroyed by these provisions in the Bill.
Amendment No. 41 which is the new clause after Clause 17, deals with the problem of succession for relatives who are not spouses. From what the Minister said on the 25th July we know that the Government have had no intention of dealing with successors who are not spouses. That is not what families are like. It very often happens that someone has been living with the tenant for a considerable time and is a member of' the family. In order to maintain the family and stop it being split up if the county court decides in default of agreement—we are not proposing anything more drastic than that—it is appropriate that there should be a right of succession and, as we say in subsection (2), we go no further than that.
These amendments are all related and they are all on the same basis. They all deal with the problems that actually arise in people's lives. These matters are not always tidy or easy to legislate for. In many cases we believe that the Government have simply overlooked some of the cases that may arise. We believe and hope that the Government will be sympathetic to these real cases of potential hardship and feel that the proposals contained in these amendments are modest and that something can be done about them. I beg to move.
The Earl of Caithness: My Lords, Amendments Nos. 40 and 41 concern succession to an assured tenancy. The noble Lord would like me to give the right to an assured tenancy to subsequent spouses of a spouse who has succeeded to an assured tenancy on the death of the tenant. I am afraid I cannot accept that. What we have created in Clause 17 is a single right of succession for the spouse only, since we accept that the tenancy should be extended to a tenant's partner by marriage, or with whom he has lived as man and wife, so that that partner may spend the rest of his or her life in the property in which they lived together. We have not agreed that people who are not related to the original tenant should be entitled to succeed. A subsequent partner by marriage has not got any particular claim on the property. If a landlord should choose to let the partner of a subsequent marriage stay in the property, all well and good. However, we are not going to give such people an automatic right. Indeed as the amendment is drafted, if there were subsequent deaths and re-marriages, the tenancy could extend well into the future.
The same arguments apply to Amendment No. 41. If a landlord wants to allow a tenancy to pass on to
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a member of the tenant's family, that is one thing, and he may contract to this effect. But we do not believe it is right that there should be a succession which would override what the landlord thought he had agreed in entering into a contract. As regards both those two important amendments which the noble Lord has moved and spoken to, we do not see any reason why the landlord should not enter into a further agreement. We are not going to make it compulsory for him to have to do so.
I turn to the next group of amendments—Amendments Nos. 105 and 106—dealing with the Rent Act succession rules, rather than Amendments Nos. 40 and 41 which deal with the assured tenancy succession. In their present state we believe that these are very unfair to landlords. Two successions are possible, so the tenancy can subsist for three generations. Meanwhile the landlord may be receiving an artificially low and uneconomic rent. We simply do not see how it is possible to justify such inequitable and discriminatory treatment of one section of the community in favour of another. The Bill therefore amends these rules. In doing so we have tried to strike a balance between the interests of both parties—both landlords and those who expect to succeed to a Rent Act tenancy.
Clause 39 and Schedule 4 do not affect anyone who has already succeeded to a Rent Act tenancy. The spouse or cohabitee of the original tenant too will continue to have the right to succeed to a Rent Act tenancy at a fair rent. But other members of the family who have lived with the tenant for two years will have the right to an assured tenancy at a market rent. A second succession will continue to be possible, but only for a member of the original tenant's family and again the successor will get an assured tenancy. Where the succession is to an assured tenancy, if landlord and tenant cannot agree on the new rent, the tenant can apply to the Rent Assessment Committee to fix it at market level.
The effect of these amendments is to negate these changes. They are obviously not acceptable to us. The Government made several changes in these provisions in another place to make the rights of succession slightly more generous than when the Bill was first introduced. On consideration we do not feel able to go further.
Turning to Amendments Nos. 107, 108, 110 and 111, I am grateful to the noble Lord, Lord McIntosh of Haringey, for mentioning his thoughts behind these amendments when we met recently. I have therefore been able to give them some fairly detailed consideration but I fear that he might not be too pleased with the conclusion I have reached.
Among other changes which are made by Schedule 4, if a member of the original tenant's family is to succeed to an assured tenancy, either on the original tenant's death or on the first successor's death, he will need to have lived with the tenant or first successor for two years. When the Bill was first introduced, it included a qualifying period of five years. We listened to the arguments of those in another place who thought that this was too long and, on reflection, agreed to reduce the period. Your Lordships will recall that a similar change was made in the Housing (Scotland) Bill. Two years seem to us

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to be about right. It is enough to establish that the person had made a permanent home with the tenant. On careful reflection I am not attracted by the shorter period though I agree with the noble Lord, Lord McIntosh of Haringey, that when one is looking at dates in such an instance as this and when one is drawing a line, there is always an argument for moving that line up or down.
Finally, Amendment No. 109 is another amendment designed to chip away at the changes to the Rent Act succession rules. I have even less sympathy with this amendment than I have with the group that we have just been discussing. The deletion of part of paragraph 6 of the schedule would allow, as under the Rent Act, a second succession by someone who had only a remote connection with the original tenant. The requirement that for a second succession to occur a family member of the first successor must also have been a member of the original tenant's family seems to us to be entirely reasonable. For instance, we do not see why if the original tenant's spouse remarries any children of that second marriage who have no direct connection with the original tenant, should be able to succeed or indeed why the cohabitee of the original tenant's spouse should have a right of succession. It is this kind of result—and it is not possible for secure tenants under the Housing Act—which has brought the Rent Act into disrepute.
Lord McIntosh of Haringey: My Lords, I am grateful for the consideration which the noble Earl has given to the amendments which, as he said, I have discussed with him since the Committee stage. As he expected, I am disappointed with the result. I believe that he has again chosen examples of tenants and their families which may well apply in a number of cases and I do not deny that. But the Government ignore the kinds of case which fall within the scope of this part of the Bill and which are bound to cause real hardship.
I shall not go over all the groups of amendments individually because I believe that would be imposing upon the goodwill of the House. I shall refer to Amendment No. 109 which provides that there should be a right to succession if somebody has been living with either the original tenant or the first successor.
This is a matter of reality. This is the way it actually happens. However much we may wish people to take out joint tenancies, in many cases they do not. I give as an example somebody who has aged parents. One of the parents dies and the surviving parent, who is not the tenant, has greater need for care. One of the children comes to live with that parent, who is the first successor. Except that it happens a little later, when it becomes necessary, that person is performing very much the same function as a carer who comes to live with both of them when they are alive or comes to live with the first tenant when the first tenant is alive. There is no distinction in social terms between a carer who comes in under those circumstances and a carer who comes to look after the original tenant.
Of course one can put it the other way round and say that there are examples of people who have no real relationship moving in, presumably with malice
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aforethought, in order to succeed to the tenancy. That is a possibility and perhaps there ought to be a more flexible legislative structure to prevent it. However, the hardship I have described will happen if the Bill is enacted without change. It is for the Government to respond to these examples of hardship rather than to dismiss them by giving examples of where there is not hardship. It is not good enough for the Minister to say that they are seeking a balance between landlord and tenant. That is not what we are looking for here. We are looking for the preservation of the family and the preservation of a sense of responsibility between different members of the family. In so far as housing legislation has the effect, whether it is intended or not, of breaking up family life—that is what we believe the effect will be—that effect is to be deplored.
To that extent I am not satisfied with what the Minister has said. It is only the lateness of the hour and the thinness of the House which prevents me from pursuing the matter to the Division Lobby. I am dissatisfied with what has been said. I am dissatisfied with the nature of the arguments that have been put forward. I believe that those who know about the reality of old age and the difficulties of family relationships will be dissatisfied as well. We must consider whether there is any way in which we can seek at Third Reading to provide some vestige of protection in those circumstances. However, at this stage, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 41 not moved.]
Clause 20 [Assured shorthold tenancies]:
The Earl of Caithness The Earl of Caithness moved Amendment No. 42:
Page 15, line 12, leave out ("a new assured") and insert ("(including a tenancy which was an assured shorthold but ceased to be assured before it came to an end) a new").
The noble Earl said: My Lords, I should like to speak at the same time to Amendments Nos. 43, 44 and 97.
One of the basic principles in our approach on shorthold is that, where a landlord grants a shorthold tenancy in good faith and satisfies the necessary requirements for the creation of such a tenancy—in particular by serving the appropriate notice—he should not at some later date discover that his tenant has been able to take advantage of some quirk in the law and assume the status of a full assured tenant enjoying indefinite security of tenure. These amendments are designed to remove two such potential quirks.
The first three amendments in the group—Amendments Nos. 42, 43 and 44—are directed at a case where a tenancy starts life as an assured shorthold tenancy but, at some point before it expires, ceases to qualify as an assured tenancy because the tenant no longer occupies the property as his principal home. As the Bill stands at the moment, if the landlord—who may be ignorant of the changed circumstances—continued to accept rent from the tenant and allowed a new tenancy to arise on expiry of the original one, then should the tenant subsequently move back into residence that new tenancy would be a full assured tenancy rather than

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a shorthold. This would seem to us to be patently unfair to the landlord. We therefore propose the first three amendments as a means of ensuring that, should a new tenancy arise in the sort of circumstances I have described, that tenancy will automatically be a shorthold without any specific action being required of the landlord.
Amendment No. 97 is aimed at the case where, on or after commencement of the Bill, a landlord grants a new assured tenancy to someone who has hitherto been his tenant under a protected shorthold tenancy or a tenancy superseding such a tenancy. As the Bill stands, the new tenancy would qualify as a shorthold only if the landlord served a notice to that effect. There is a risk that an unwary landlord might overlook the need to serve such a notice and thereby allow the tenant to become a full assured tenant. This again would seem to us to be an unfair trap for the landlord. The amendment therefore provides that a new assured tenancy granted in the circumstances I have described will automatically be a shorthold unless the landlord serves notice that it is not. Such a provision cannot be regarded as in any way unreasonable to the tenant, since he will have started out as a shorthold tenant and will thus have had no expectation of long-term security.
We regard these amendments as playing a small but useful role in ensuring an equitable balance between the interests of landlord and tenant. I commend them to your Lordships.
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendments Nos. 43 and 44:
Page 15, line 15, leave out ("the new tenancy") and insert ("then. if and so long as the new tenancy is an assured tenancy, it").
Page 15, line 18, leave out ("assured").
On Question, amendments agreed to.
Clause 22 [Reference of excessive rents to rent assessment committee]:
[Amendment No. 45 not moved.]
Schedule 3 [Agricultural worker conditions]:
The Earl of Arran The Earl of Arran moved Amendment No. 46:
Page 112, line 7, after ("occupier") insert ("or, where there are joint occupiers, at least one of them").
The noble Earl said: My Lords, in moving Amendment No. 46, I should like to speak to Amendments Nos. 47 to 69 inclusive.
These amendments extend the principle of joint occupancies to the assured agricultural occupancy regime. The main body of the Bill contains, unlike the Rent Act, specific provision for joint tenancies. The absence of such specific provision in the Rent Act has led to some problems, which is why we are providing explicitly for them in this Bill; and as we have provided for joint assured tenancies, so we need to cater for joint assured agricultural occupancies. In revising the schedule to achieve this, we have taken the opportunity to make some purely drafting amendments, and to align the assured agricultural occupancy regime with the main regime in one
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respect. Amendment No. 62 provides that where there is more than one person who could claim to be a successor to an assured agricultural occupancy, the parties or, in the event of failure to agree, the county court may decide who shall succeed. These are straightforward amendments. I beg to move.
On Question, amendment agreed to.
The Earl of Arran The Earl of Arran moved Amendments Nos. 47 to 69:
Page 112, line 16, leave out ("the condition in paragraph 2 above") and insert ("that condition").
Page 112, line 17, at end insert ("or, as the case may be, a person who was one of the joint occupiers").
Page 112, line 20, leave out ("previous").
Page 112, line 21, after ("above") insert ("(hereinafter referred to as "the previous qualifying occupier")").
Page 112, line 23, leave out ("that previous") and insert ("the previous qualifying").
Page 112, line 24, leave out ("that previous") and insert ("the previous qualifying").
Page 112, line 26, leave out ("a previous") and insert ("the previous qualifying").
Page 112, line 28, after ("previous") insert ("qualifying").
Page 112, line 30, leave out ("a previous") and insert ("the previous qualifying").
Page 112, line 32, after ("previous") insert ("qualifying").
Page 112, line 35, after ("previous") insert ("qualifying").
Page 112, line 36, leave out ("the previous occupier's") and insert ("his").
Page 112, line 37, leave out ("previous") and insert ("the previous qualifying").
Page 112, line 45, leave out ("occupier") and insert ("member").
Page 112, line 47, after ("previous") insert ("qualifying").
Page 112. line 49, at end insert—
("(6) If, immediately before the death of the previous qualifying occupier, there is, by virtue of sub-paragraph (5) above, more than one person who falls within sub-paragraph (1)(c)(i) above, such one of them as may be decided by agreement or, in default of agreement, by the county court, shall be treated as the qualifying widow or widower for the purposes of this paragraph.").
Page 113, line 2, leave out ("licence or tenancy") and insert ("tenancy or licence").
Page 113, line 3, after ("occupier") insert ("or, where there are joint occupiers, at least one of them").
Page 113, line 5, after ("occupier") insert ("(or one of joint occupiers)").
Page 113, line 6, after ("dwelling-house") insert ("as a result of his occupation").
Page 113, line 8, at end insert—
("and the reference in paragraph (a) above to a tenancy or licence granted to the occupier or at least one of joint occupiers includes a reference to the case where the grant is to him together with one or more other persons.").
Page 113, line 16, leave out from ("occupier") to end of line 17 and insert ("or one of the joint occupiers under the earlier tenancy or licence and as a result of whose occupation the agricultural worker condition was fulfilled as mentioned in paragraph (a) above;
and the reference in paragraph (b) above to the grant of the later tenancy or licence to the person mentioned in that paragraph includes a reference to the case where the grant is to that person together with one or more other persons.").
Page 113, leave out lines 18 to 20 and insert—
("(2) So long as a person as a result of whose occupation of the dwelling-house the agricultural worker condition was fulfilled with respect to the earlier tenancy or licence continues to be the occupier, or one of the joint occupiers, under the later tenancy or licence, the agricultural worker condition shall be fulfilled with respect to the dwelling-house.").
On Question, amendments agreed to.
Clause 26 [Rehousing of agricultural workers etc.];
Lord Stanley of Alderley Lord Stanley of Alderley moved Amendment No. 70:
Page 18, line 35, at end insert—
("(2) In section 28(7) of the Rent (Agriculture) Act 1976 (rehousing: duty of housing authority concerned) the words "they shall use their best endeavours to" shall be omitted and there shall be substituted the words "it shall be the duty of the authority to secure that he will be provided with".").
The noble Lord said: My Lords, I should like to speak at the same time to Amendment No. 214. This amendment to Clause 26 is intended to strengthen the terms of the duty on local housing authorities under Section 28 of the Rent (Agriculture) Act 1976. At present, where the authority is satisfied that the applicant's case for rehousing is substantiated it must use its best endeavours to provide suitable alternative accommodation. This amendment seeks to replace this with a duty to secure that the applicant will be provided with suitable alternative accommodation. My amendment is based on the assumption that a duty to secure accommodation places a higher standard of duty on authorities which would be more likely to ensure that accommodation is actually found.
Without the amendment I fear that authorities will claim increasingly that they are sorry not to have been able to find accommodation but they have used their best endeavours. I would remind your Lordships, as I did in Committee, of my concern that as the housing authorities have fewer houses they will find it more difficult to re-house. It seems to me perfectly straightforward. Therefore, I wish to tighten up their obligation to re-house.
Amendment No. 214 to Clause 128 relates to the same fear; namely, that the transfer of housing stock from the public sector to the private sector will result in authorities becoming unable to re-house agricultural workers under the 1976 Act. Under the Department of the Environment's guidance to local housing authorities and the Secretary of State's policy in relation to applications for consent to such transfers, written, I think, in June this year, the authority is expected to be able to demonstrate that it will satisfactorily discharge its continuing statutory obligations, including Section 28 of the Rent (Agriculture) Act 1976.
I welcome the guidelines issued to local authorities. I welcome also the Minister's statement in Committee at col. 826 of Hansard of 11th October confirming that the Secretary of State views this as a relevant consideration. However, the Minister also said that Clause 128 places a general duty on the Secretary of State to have regard to any matters which he considers relevant. But the clause reads:
"The matters to which the Secretary of State may have regard in determining whether to give consent…shall include"
and so on. The amendment would clearly make a discretion into a firm duty. Therefore I ask my noble friend for clarification. Is there a duty to provide alternative accommodation, or is there merely a permissive power to do so? Will he also explain whether the guidelines sent to local authorities apply to any disposal of housing? They appear to be addressed simply to large-scale disposal of housing. I beg to move.
8.30 p.m.
The Earl of Caithness: My Lords, I cannot say too strongly that I fully appreciate the anxieties that lie behind my noble friend's amendment. However, I can assure my noble friend that I do not believe the amendment is necessary. I could enter into a dispute with him as to lawyers' opinions of the precise meaning of the present wording and go through cases where the courts have given their opinions on what is meant by placing a local authority under duties of this kind. However I do not think that your Lordships would be very pleased if I were to do so at this time of night. Essentially my noble friend is concerned that local authorities are increasingly unable to provide accommodation for agricultural workers who need to be rehoused.
The position, I understand from the Ministry of Agriculture, is that certainly in some areas, where right to buy has been successful, it is taking longer for local authorities to rehouse on the recommendation of the ADHAC. But I would contend that that is a temporary situation. We are affected by the success of one policy—right to buy—before we have had time to see the effects of the success of another; that is, deregulation and widening the choice of landlord, which we intend to achieve by the Bill.
It is a principle aim of the Bill to encourage more accommodation to come on to the market and to encourage diversity of tenure. We expect local authorities to house people more and more in accommodation which they do not own themselves. Whatever the legal debates may be about the meaning of Section 28(7) of the Rent (Agriculture) Act, local authorities will continue to pursue the best interests of agricultural workers and they will be better able to help them when the Bill has come into effect because there will be more accommodation available.
As regards Amendment No. 214, my noble friend is developing an argument he started in Committee. He is challenging me to put my money where my mouth is. I said in Committee that the Secretary of State's declared policy was that he would have to be satisfied that a local authority could continue to fulfil its statutory duties, including those under the Rent (Agriculture) Act, before he gave consent. Indeed, I went further and said that even if we had not chosen to adopt that policy the law as it stands would require us to have regard to the local authority's ability to fulfil such duties.
I shall not repeat in detail the reasons for feeling confident enough to make that statement. The basic point is that the Secretary of State is free to take account of all relevant considerations. And the ability of the local authority to continue to fulfil its statutory functions is clearly a relevant consideration.
The difficulty with the amendment lies in the new subsection (4A) contained in Clause 128 which requires the Secretary of State to have regard to a number of considerations. If he had an absolute duty to look at those considerations in every case, no matter how inappropriate they were in a particular case, it would not be possible for him to give general consents. He would have to give specific consideration to every disposal.

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The effect of the amendment would be to destroy the Secretary of State's ability to issue general consents, a move which I am sure my noble friend realises would have far-reaching consequences. It is for that reason that I cannot accept my noble friend's amendment. However, I hasten to assure him that nothing in what I have just said weakens the requirement of the Secretary of State to have regard to relevant considerations. In cases where an authority is selling most, or all, of its stock, I have said that the ability to carry out duties under the 1976 Act is clearly relevant. If a court found that the Secretary of State had not had regard to a relevant consideration, then regardless of whether the clause says "may" or "shall", I am satisfied that he would be expected to take it into account.
However, I am comforted to learn that when the clause was being drafted the debate we are now having was foreseen. It was noted at the time that a clause which included the word "shall" would make it easier to present the case. That is why it was included.
Lord Hylton: My Lords, before the noble Earl sits down, perhaps I may commend to him the old proverbial saying: "you can't get a quart out of a pint pot".
Lord Stanley of Alderley: My Lords, that is indeed the point. I am still a little worried as to whether there will be the ability to re-house. I do not know whether my noble friend can add one final point. I asked him1—I do not think he replied in so many words—about the guidelines sent to local authorities which clearly state their responsibilities to re-house agricultural workers. As I understand it, they only refer to large-scale disposals. I wonder whether he can confirm that the guidelines also apply to small-scale disposals.
I do not know whether my noble friend is able to answer that question. While he is thinking about it, I must say that I was not impressed with the fact that he admitted that where there had been disposals of housing the Minister of Agriculture had admitted that it was becoming more difficult in such areas to re-house agricultural workers. He went on to say that that was the exception to prove the rule. At least I think those were more or less his words. I am afraid that I could not follow his argument in that respect. I hope that the Minister can add a little more on the subject of the guidelines before I sit down.
The Earl of Caithness: My Lords, with the leave of the House I shall of course take note of what my noble friend has said. I shall study his remarks carefully. However I thought I had already covered the point. If my noble friend wishes to pursue that point my right honourable friend the Secretary of State will not be able to issue general consents any more. The implications of my noble friend's proposal would mean that he had to have specific proposals which I do not think in the short, or indeed in the long-term, would benefit my noble friend. Therefore he might feel that he was better off with the situation as now appertains.
Lord Stanley of Alderley: My Lords, I am not entirely happy with my noble friend's reply but I shall study what he said. Meanwhile I can see that regrettably I shall not make any more progress on this matter. I shall just have to trust that the position works out as well as my noble friend on the Front Bench hopes and believes that it will. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 27 [Damages for unlawful eviction]:
Lord Coleraine Lord Coleraine moved Amendment No. 71:
Page 19, line 13, leave out ("calculated") and insert ("likely").
The noble Lord said: My Lords, we come now to Chapter IV of Part I of the Bill, which deals with protection from eviction. With Amendment No. 71 it may be convenient to speak also to Amendments Nos. 75 to 82. I at once acknowledge the help of my noble friend the Minister who has taken on board what has been said and has provided assistance in drafting the amendments. The amendments arise out of the two debates we had in Committee in July when we considered extensive additional protection from harassment or unlawful eviction which is being provided for tenants under Chapter IV of this part of the Act.
In the first of the two Committee stage debates the noble Lord, Lord McIntosh of Haringey, had tabled as Amendment No. 1 an amendment which had no particular effect but which mentioned protection from eviction and enabled preliminary general discussion to take place. That allowed the noble Lord, and many of his noble colleagues, to speak at some length and some breadth about two obnoxious property speculators, one of whom is now long dead and another of whom I shall not mention tonight.
The argument seemed to he that by mentioning those people again and again it was possible to dispense with any proper consideration of the long history of harassment so that the Rent Acts, which had preserved unfair rents and done so much to bring about a climate in which harassment, winkling and unfair and wrongful eviction could flourish, were in some way presented as a safeguard against those monstrous practices.
By the second day of the Committee stage debates, however, the spectres of those two gentlemen had been largely dispersed. We had had a useful preliminary debate and it was possible to have a sensible discussion of the Government's proposals when the various amendments came to be considered. We should be in no doubt that Chapter IV provides a significant strengthening of the law for the protection of tenants. However, difficulty arises from the use of the word "calculated" in Clause 27 and in Section 1 of the Protection from Eviction Act 1977, from which the drafting of Clause 27 is derived.
"Calculated" means in English, if I may be dogmatic, "intended". It was in that sense that most of your Lordships understood the word in July. It was also the sense in which I believe the parliamentary draftsman understood it. The objection I say to the word as so understood, and in relation to Clause 27, was that if a tenant wished to

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establish harassment or wrongful eviction by the route provided by subsection (2)(b) on the grounds that the landlord did acts:
"calculated to interfere with the peace or comfort",
of the tenant, the tenant had to show first that the landlord knew or had reasonable cause to believe that his conduct would cause the tenant to leave; and, secondly and independently, that the landlord intended the interference with the peace and comfort.
The two facts to be proved added up to an unreasonable and unnecessary burden of proof on the tenant. On that ground, if on no other, it would be desirable for the word "calculated" to be replaced by the word "likely". That suggestion was made by the noble Lord, Lord McIntosh, when he discussed an amendment which he did not move and which I believe emanated from the Law Society.
There is however authority for saying that the courts would interpret "calculated" as meaning "likely" in the Protection from Eviction Act and the Bill, when enacted. If so, there is every reason why both pieces of legislation should now be amended by substituting the word "likely" for the word "calculated". A benefit of substance would be achieved. The statutory provisions would say what they mean and become at once more immediately accessible and comprehensible to tenants and their advisers, and therefore of more value.
My noble friend the Minister wrote to me that he had been advised that the word "calculated" probably means "likely", and that he had come to the conclusion that Clause 27 and Section 29 of the Protection from Eviction Act needed to be clarified.
The first amendment is the substantial amendment. It provides for "likely" to replace "calculated" in Clause 27. Amendments Nos. 77 and 79 achieve the same effect in relation to the Protection from Eviction Act, as amended by the Bill, and because that Act imposes criminal liability the change in the law effected by the amendments would only have effect in respect of acts done after commencement.
The Bill provides that it shall be a defence for a landlord both in relation to a civil offence under Clause 27 and to a criminal offence under the new Section 1(3)(a) of the Protection from Eviction Act to show that he the landlord had reasonable grounds for withdrawing or withholding services.
The substitution of the word "likely" for the word "calculated", with the result that it would not be necessary for a tenant to show that a landlord has intended the consequences of acts likely to interfere with peace and comfort, makes it desirable for the defence also to be available to the landlord that he had reasonable grounds for doing those acts.
Amendments Nos. 75, 76 and 82 achieve that object. Amendments Nos. 78, 80 and 81 are consequential drafting amendments. I beg to move.
8.45 p.m.
Lord McIntosh of Haringey: My Lords, in introducing the amendments the noble Lord, Lord Coleraine, was pleased to attack the Opposition for referring to specific cases of harassment. I shall not defend the reference to Mr. Rachman. I did not refer
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to him. I agree that he has been dead for some time. Mr. Hoogstraten is by no means dead. He is rejoicing in the prospect of an expansion of his activities under the regime that will be introduced by the Bill. I in no way apologise for introducing Mr. Hoogstraten's name or for drawing attention to the ways in which it will still be possible to drive a coach and horses through the anti-harassment provisions of the Bill if they are enacted unchanged by the Government, and the situation will be substantially worse if some of the noble Lord's amendments are agreed to.
After all, the noble Lord seems to think that it is an answer to the problem of the courts being involved in harassment cases merely to give way to the harassers. One can improve the crime statistics by abolishing the offence of drunken driving for example. Driving and drinking occupies a substantial part of our criminal calendar. We could improve our crime statistics, and the Home Secretary could have a jolly time at the Conservative Party conference, if we merely abolished all the parts of the law relating to drunken driving. I am sorry to say that some of the noble Lord's amendments are along those lines.
However, I must start by saying that the amendments which refer to the replacement of the word "calculated" by the word "likely" are different. They have our support. They follow the lines of the arguments which were put forward in Committee. We never thought that "calculated" meant "likely". We agree that "intention" is difficult to prove and that the effect is what should be taken account of.
The noble Lord's other amendments seem to be extremely damaging and to weaken the courts' powers to deal with acts of harassment. At the moment the Bill says that mitigating circumstances should apply only to the withdrawal or withholding of services, not to definite acts of harassment. That seems reasonable. Taking away a staircarpet, which in some circumstances could be an act of harassment, could also be part of a longer term refurbishment scheme which was unavoidably delayed. The same could be true of taking away lights or some of the other acts of negative harassment, if I may put it that way, which take place.
It is much more difficult to argue that positive acts of harassment can have mitigating circumstances. That would be the effect of the noble Lord's amendments. It seems to us that the mitigating circumstances which ought to be taken into account by the courts should only exclude the withdrawal or withholding of services and should not exclude definite and positive acts. To the extent that these amendments weaken the Bill, even though we understand that they have the Government's support, I can assure the noble Lord that they do not have our support. Although at this time of night we shall not go into the Lobbies against the amendments, we certainly see them as evidence of a weakening of the Government's resolve to deal effectively with the kind of harassment which has taken place and which we fear will go on taking place after the Bill has been enacted.
Lord Meston: My Lords, concentrating on Amendment No. 71, I suggest that this amendment is useful in replacing the awkward word "calculated"

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with the word "likely", which provides a more objective test which should help tenants to prove their case. It should make life easier for the courts in operating the Bill when it becomes law and I think it will assist the Government in their declared intention to deter harassment and unlawful eviction.
The Earl of Arran: My Lords, I am grateful to my noble friend Lord Coleraine for putting down these amendments. As he explained, we had some discussion at Committee stage of the meaning of the word "calculated" in Clauses 27 and 29. At that stage we were inclined to take the view that the word meant "intended", but on taking further advice we now agree with several noble Lords, including the noble Lord. Lord McIntosh, who thought that it probably meant "likely to". It is obviously not desirable that there should be doubt about this matter. We therefore welcome my noble friend's amendments which remove any doubt.
We welcome too his amendments to subsection (7)(b) of Clause 27 and the new subsection (3B) inserted in Section 1 of the Protection from Eviction Act 1977 by Clause 29. These give the landlord a defence where his actions might have been likely to lead to the occupier leaving the dwelling, but where he had reasonable grounds for his conduct. This is an essential safeguard. The Government therefore support these amendments.
Perhaps I may also speak to government Amendment No. 241 which amends the Housing (Scotland) Bill in a way which parallels the amendments tabled by the noble Lord, Lord Coleraine. It also makes changes in relation to notices given under that Bill to match amendments which have already been made to Part I of this Bill. I commend the amendments to your Lordships' House.
Lord Coleraine: My Lords, my noble friend has answered the noble Lord, Lord McIntosh, very much better than I could. However, I think it must be said that if a tenant does not have to prove that his landlord intended the consequences of his actions but that the consequences were merely "likely", it is only right that there should be a fair balance between landlord and tenant and that this should produce the result that the amendments produce.
Lord McIntosh of Haringey: My Lords, I fear that I did not make my position clear to the noble Lord. I said that we supported the change from "calculated" to "likely" not, as the noble Earl suggested, because we thought that "calculated" meant "likely". We do not think it means "likely" but it ought to. To that extent we support these amendments. We are opposed to the extension of the mitigation from acts of omission to actual positive acts.
Lord Coleraine: My Lords, with the leave of the House, I was trying to deal with the very point which the noble Lord, Lord McIntosh, is making. He does not see why the defence should be extended in the way that my amendments propose it should be
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extended. It is in the interests of achieving a fair balance between landlords and tenants in the change or the shift of the need to produce evidence in favour of the tenant. That is what justifies the amendments.
The answer to the noble Lord can be found in his own words, which were to the effect that there were cases where removing a carpet as part of the process of refurbishing a flat might interfere with the comfort of the tenant. But it might have been necessary for the stair carpet to be removed. In that type of case it is surely right that the landlord should, as a defence, be able to say that the action was reasonable. The consequences might have. been likely but they were certainly never intended by the landlord.
The noble Lord, Lord McIntosh, said that it was difficult to see where positive acts of prima facie harassment could ever be mitigating circumstances. However, the amendment which I am proposing merely provides that, where it is reasonable for these acts to be under mitigating circumstances, that should provide a defence. I commend the amendments to your Lordships.
On Question, amendment agreed to.
The Earl of Arran The Earl of Arran moved Amendment No. 72:
Page 19, line 35, leave out ("proceedings are begun to enforce the liability") and insert ("the date on which proceedings to enforce the liability are finally disposed or).
The noble Earl said: My Lords, in moving Amendment No. 72 I should also like to move Amendment No. 73. These amendments arise from a point made in Committee by the noble Lord, Lord Meston, which we agreed to consider. He argued that court proceedings could have a salutary effect on a landlord. The full enormity of what he had done and the prospect of paying very considerable damages could lead a landlord to reconsider his behaviour and to reinstate the tenant.
That of course is what both we and the noble Lords opposite would want to happen. The tenant might not receive damages under Clause 27 but he would still be able to bring an action against the landlord for breach of the convenant for quiet enjoyment and to receive such damages as the court considered he was entitled to. Under the amendments which we have drafted the landlord has until the expiry of any appeal period in which to change his mind and reinstate the tenant. We believe that these amendments could lead to several tenants being restored to their homes who might otherwise not be. We should like to thank the noble Lord, Lord Meston, for guiding us along this route. We commend the amendments to your Lordships' House. I beg to move.
Lord Meston: My Lords, I am grateful to the Government for taking up the point which I raised in Committee. It should provide an encouragement to landlords to repent, even if that comes at the fifty-ninth minute of the eleventh hour. I am very grateful.
Lord McIntosh of Haringey: My Lords, I hope that that is right and it will be the effect of the amendments, but I am by no means convinced of it. I am certainly in favour of the possibility of a

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landlord repenting and reinstating the tenant and all the tenant's rights, thereby avoiding liability. So as regards the motivation behind the amendment, I do not think there is any disagreement.
However, the danger I foresee is that it could enable landlords to drag out the proceedings and continue with a programme of harassment on the basis either that they win and the tenant is forced out—which seems to me much the most likely consequence because they are provided with that much more time in which to achieve it—or, if they think they will lose, at the very last minute they can withdraw the harassment and will not have to face any liability. I am not at all convinced, on the face of it, that what we have is an improvement or that the extended time period for the landlords will work in favour of the tenants, which is what I want.
Lord Meston: My Lords, with respect to the noble Lord, he suggested that this would enable the landlord to avoid all liability. I do not understand that to be the position. He will avoid liability for the particular form of punitive damages arising under the Bill. He will not avoid liability for ordinary compensatory damages, for example, if he drags matters out. The more he drags matters out, the more compensation he will have to pay, as he would in any other case. He simply avoids one particular category of damages.
Lord McIntosh of Haringey: My Lords, with the leave of the House, I accept that correction as regards the nature of the liability he is avoiding. However, it still seems to me that the possibility of dragging matters out is to the disadvantage of the tenant rather than the other way round. Tenants who are exposed to a long-term programme of harassment will be more at risk because the landlord will not do it unless he thinks that tenants will become fed up, give up and go away. That is the intention of most harassment. That is the way it normally happens. Far more harassment cases do not come to court not because landlords give up harassment but because tenants lose hope and despair and get out of property. Harassment wins. The problem is not that harassment fails, but rather that harassment wins without the case coming to court. I am afraid that these amendments will encourage harassment to win without the matter getting to court.
On Question, amendment agreed to.
9 p.m.
The Earl of Caithness The Earl of Caithness moved Amendment No. 73:
Page 19, line 42, at end insert—
("and for the purposes of paragraph (a) above, proceedings to enforce a liability are finally disposed of on the earliest date by which the proceedings (including any proceedings on or in consequence of an appeal) have been determined and any time for appealing or further appealing has expired, except that if any appeal is abandoned, the proceedings shall be taken to be disposed of on the date of the abandonment").
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 74:
Page 19, line 42, at end insert—
("(6A) If, in proceedings to enforce a liability arising by virtue of subsection (3) above, it appears to the court—

(a) that, prior to the event which gave rise to the liability, the conduct of the former residential occupier or any person living
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with him in the premises concerned was such that it is reasonable to mitigate the damages for which the landlord in default would otherwise be liable, or

(b) that, before the proceedings were begun, the landlord in default offered to reinstate the former residential occupier in the premises in question and either it was unreasonable of the former residential occupier to refuse that offer or, if he had obtained alternative accommodation before the offer was made, it would have been unreasonable of him to refuse that offer if he had not obtained that accommodation,

the court may reduce the amount of damages which would
otherwise be payable by such amount as it thinks appropriate.").
The noble Earl said: My Lords, I beg to move Amendment No. 74 and to speak to Amendment No. 242 at the same time. Although practised by a small minority of landlords, harassment and illegal eviction are deplorable and, as your Lordships will know, we take a very serious view of them.
Despite criticisms from those who argue for much wider sanctions, we believe that the provisions of the Bill and of the Housing (Scotland) Bill which strengthen the criminal and civil law in this area are an important improvement. The new civil right to damages in Clauses 27 and 28 in particular should be a real deterrent to bad behaviour by landlords, potentially involving damages on a very substantial scale in some cases. The aim is to remove much of any financial gain which the landlord might have made from getting rid of the tenant. Indeed, one might say that the provisions are taken in terrorem.
Clauses 27 and 28 have generally been welcomed though there has been concern that in certain cases they could penalise landlords unfairly. The noble Lord, Lord Meston, and my noble friend Lord Jenkin of Roding raised this issue in Committee and we agreed to consider whether the court should be given some discretion about the amount of damages. We are certainly under no illusion that bad behaviour is confined to landlords and there are undoubtedly cases where the landlord who evicts a tenant illegally acts under extreme provocation.
These amendments to Clause 27 and to the equivalent provision in the Housing (Scotland) Bill therefore give the court a measure of discretion to adjust the damages to fit the circumstances of the case. If the discretion given to the court is too wide, we suspect that damages awarded are likely to continue at present levels, which often bear relationship to the tenant's loss.
The presumption is, therefore, that the full measure of damages will normally be awarded where the case is proved. However, the damages can be reduced if it is reasonable to do so in view of the tenant's conduct or the conduct of anyone living with him before the eviction took place or where the tenant unreasonably refused an offer of reinstatement. We feel that this should cover most of the cases which the critics of Clause 27 have in mind, for instance where the tenant provoked the landlord, or where the landlord excluded the tenant, perhaps simply by changing the locks without understanding the full legal implications of his action, but then relented and offered to let the tenant return. Of course, the court would be unlikely to consider that it would have been reasonable for the tenant to return if the landlord had used force or harassed the tenant over a long period.
The second amendment also incorporates in the Housing (Scotland) Bill a provision equivalent to that in the amendments which the House agreed just now. I hope that we can all agree that this is a useful improvement to the Bill. I would like to pay a particular tribute to my noble friend Lord Jenkin, who I am very pleased to see has put his name to the amendment. It was he who most clearly articulated the concern about this new tort, while supporting the principle behind it, and he has been most helpful to us in framing these amendments. I beg to move.
Lord Monson: My Lords, I thank the noble Earl for listening so carefully to the arguments made in Committee where I intervened myself, as did the noble Lords, Lord Meston and Lord Jenkin of Roding. I also thank the noble Earl for the effort he has put into drafting this commendable amendment. Not only does it make the Bill more equitable, but its practical effect will he to make potential landlords more willing to let than would be the case in the absence of the amendment. That is an outcome which we must surely all desire, irrespective of our views on the Bill as a whole.
The noble Earl may possibly have read in this month's edition of Country Landowner the Land Agent's Letter column in which clients are advised to sell tenanted properties the moment they become vacant, on the grounds that current shorthold regulations load the dice against the landlord.
Lord McIntosh of Haringey: No, my Lords.
Lord Monson: My Lords, the noble Lord, Lord McIntosh, disagrees. He thinks he has a monopoly on the loading of the dice. But dice can be loaded both ways. I know the noble Earl will agree that the dispelling of any reluctance to let or to relet on the part of potential or actual landlords is one of the most important aims of the Bill. Indeed, unless that aim is successful, the Government's housing policy will not work.
Lord Meston: My Lords, I am glad that the Government have introduced a measure of flexibility and discretion into this part of the Bill. But it will still expose both landlords and tenants to potentially expensive and complicated litigation. However, I believe that some measure of balance has been restored. Nevertheless, I repeat the point which I made in Committee—a point which in some ways would meet many of the arguments of the noble Lord, Lord McIntosh. That point is that the Bill is deficient in this area because the whole question of aggravated or punitive damages for tenants would almost certainly not have to arise if' the Government had grasped the nettle and given the courts an express power to reinstate unlawfully evicted tenants. However, that has not been done, but the amendment improves what was hitherto in the Bill.
Lord McIntosh of Haringey: My Lords, I appear to be cast in the role of grumpy bear. I am the one who does not like all these things that are being done. All
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the other noble Lords around the House appear to like the provisions. I think this is a totally unacceptable amendment. I am sorry that the Government are moving it, and I am sorry that they have obtained so much agreement from noble Lords. I am not against discretion to the courts, but in the real world in which harassment is intended to kick tenants out, preferably before they go to the courts, and where it very often succeeds in kicking tenants out, the one way in which tenants would be evicted more easily is if landlords think that there is an advantage to be gained from taking the opportunity to make allegations against tenants in order to get them out. That is the kind of misconduct which will be adduced in evidence. If the courts have the discretion to pay attention to that kind of evidence tenants will fear the judgment of the courts. They will fear going to the courts and will he more likely to give up the case before it ever gets to court.
I do not believe that courts should have discretion of this kind. It is far too easy and far too common for landlords who want to achieve an objective which is financially to their advantage—in other words, to get their tenants out—simply to bolster their case by allegations which will never come to court. They know perfectly well that tenants will leave first. They have simply to say, "If you, the tenant, pursue this and go to court we will make all these allegations about you. We will make sure that the court is so confused that it has to consider the possibility of reducing the damages".
I do not wish to intervene in the argument of the noble Lord, Lord Meston, concerning punitive damages. I do not understand the legal issues involved. I am not concerned with whether they are punitive damages or any other kind of damages. This amendment continues to load the dice in favour of the landlord. We are against it.
On Question, amendment agreed to.
Lord Coleraine Lord Coleraine moved Amendments Nos. 75 and 76:
Page 20, line 1, at end insert ("the doing of acts or").
Page 20, line 3, after ("for") insert ("doing the acts or ").
On Question, amendments agreed to.
Clause 29 [Further offence of harassment]:
Lord Coleraine Lord Coleraine moved Amendments Nos. 77 to 82:
Page 21, line 15, leave out ("after subsection (3)") and insert ("with respect to acts done after the commencement of this Act, subsection (3) shall have effect with the substitution, for the word "calculated", of the word "likely".
(2) After that subsection").
Page 21, line 17, at beginning insert ("Subject to subsection (3B) below").
Page 21, line 19, leave out ("calculated") and insert ("likely").
Page 21, line 22, leave out ("subject to subsection (3B) below").
Page 21, line 32, leave out from ("above") to ("if") in line 33.
Page 21, line 34. after ("for") insert ("doing the acts or").
On Question, amendments agreed to.
Clause 30 [Variation of scope of 1977 ss. 3 and 4]:
Lord Graham of Edmonton Lord Graham of Edmonton moved Amendment No. 83:
Page 21, line 45, at beginning insert—
("(1) In section 3 of the 1977 Act (prohibition of eviction without due process of law (after subsection (2A) there shall be inserted the following subsection
"(2) This section applies in relation to any premises occupied as a dwelling under a licence, as it applies in relation to premises let as a dwelling under a tenancy, and the expressions "let" and "tenancy" shall be construed accordingly." ").
The noble Lord said: My Lords, in moving Amendment No. 83 I should like to speak also to Amendments Nos. 84, 85, 90, 91, 93 and 94. These amendments are concerned with that section of Clause 30 which relates to the 1977 Act prohibiting eviction without due process of law. The issue we wish to raise with the Minister is the unacceptability of taking away from certain categories of tenancy and licence holder the protection that before they can be evicted they have the right of access to the courts.
By deleting the first two subsections of Clause 30 we seek to remove the concept of excluded tenancies and licences which has been introduced in the Bill as a means of disapplying the Protection from Eviction Act 1977. Under that Act it is a prerequisite for a court order to have been obtained. The Minister has an opportunity not only to assist the House but also to assist individuals. I am not able to quantify the number of people who are likely to be affected by this provision.
I believe that I should refer also to Amendment No. 91. Clause 32 ensures that licences must be ended by four weeks' written notice to quit. It also disapplies that rule to excluded licences and tenancies. Amendment No. 91 seeks to remove that disapplication.
Turning to Amendment No. 93, we ask the Minister and his advisers to look at a situation which would arise if the Bill continues to include the concept of excluded licences and tenancies. I put it to the Minister that the amendment provides an alternative approach. It proposes that because excluded licensees and tenants are denied the right to a court order as a prerequisite to eviction, this extreme degree of insecurity of tenure should be compensated for by the length of time the notice to quit has to run. Our proposal is eight weeks instead of the four weeks' notice which would apply to licences and tenancies which are not excluded. That would at the very least give some extra time for the occupant to look around for an alternative home.
Another matter dealt with in this string of amendments is that addressed by Amendment No. 85. We are saying here that there should be no exclusion from a court order under the Protection from Eviction Act for tenants who share a bathroom or toilet with their landlord. This amendment seeks to ensure that tenants who only share with the landlord accommodation such as a bathroom or toilet will not be excluded tenants and will therefore continue to enjoy the protection of the Protection from Eviction Act 1977. A distinction needs to be drawn between cases in which tenants and landlords share accommodation such as a kitchen or living
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room and cases in which they only share a bathroom or toilet. Unlike the former situation, the degree of contact between landlord and tenant in the latter situation will be relatively slight.
However, as the Bill is drafted a tenant with a resident landlord who merely shares a WC with that landlord or a member of the landlord's family could be excluded from the 1977 Act. Our amendment seeks to clarify the meaning of the word "accommodation" to ensure that tenants will be excluded from the 1977 Act only if they share rooms such as a kitchen or living room where a substantial amount of the parties' time is spent living on top of each other. It will not prevent resident landlords who wish to let a bedsitting room in their house or flat with shared use of the kitchen from gaining possession without having to go to court.
As the Minister and his advisers will realise, although these situations are distinct, they also form part of a general case which these amendments seek to make; namely, that introducing the concept of excluding tenancies and licences from the housing legislation ignores the basic right that before an eviction has legal force, authority needs to be sought through the court. I should be very much obliged if the Minister will deal with that general principle as well as with the detail. I beg to move.
9.15 p.m.
The Earl of Caithness: My Lords, I hope that the noble Lord, Lord Graham, will allow me to reply to him in three parts. I should like to deal first with Amendments Nos. 83, 84, 90, 91 and 94.
In Clauses 30 to 32 we are trying to recast the provisions of Sections 3 and 5 of the Protection from Eviction Act 1977 which require an owner to obtain a court order to evict certain residential occupiers and to give four weeks' notice to quit in writing in certain cases. The effect of these clauses is to bring within the scope of the 1977 Act for the first time many licensees who have hitherto been outside it. If there is a dispute about possession in cases of this kind, it is best that it should be settled in court, especially in view of the use of licences in the past as a device to avoid Rent Act controls—though we hope that much of this activity will cease once landlords have a fairer statutory regime within which to operate. There is no obvious reason either why these residents, many of whom may have made their permanent homes in the property, should not have a minimum period of notice.
However, it does not make sense to require four weeks' written notice and a court order to evict in every case and therefore we propose to exclude from the 1977 Act certain licences and general tenancies granted after commencement. These excluded licences and tenancies are defined in Clause 31. They are of four kinds. Tenancies and licences granted by resident landlords to people sharing living accommodation either with the landlord or with members of his family are excluded. So are tenancies and licences granted as a temporary expedient to trespassers, for instance, squatters, and those granted to holidaymakers. Finally, licences granted in hostels run by the bodies listed in Clause 31(8) are excluded.

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In all these cases no doubt an order would be needed to evict and the normal common law rules on notice would apply.
So in these clauses we are trying to draw the boundary in Sections 3 and 5 of the Protection from Eviction Act in a different way. These amendments collectively remove the references to excluded licences and tenancies with the result that it would be necessary to give a minimum of four weeks' written notice to quit for all periodic tenancies and licences and to obtain a court order to evict in all cases. This clearly will not do. It is quite unreasonable to require an owner to give four weeks' notice to a holidaymaker or squatter and if necessary to obtain a court order to remove him. The same is true of licensees in hostels providing temporary accommodation. Such provisions would simply encourage occupants who had no contractual or statutory security to remain in the property, often without paying rent, knowing that it could take months to obtain and enforce a court order.
In the case of resident landlords I agree that there is more scope for argument because their tenants and licensees are more likely to have made the accommodation their permanent home. But we think that, where a landlord is living in the same house or flat as his tenant or licensee and he or members of his family are actually sharing living accommodation with that person, it is unreasonable to require him to give a long period of notice and to wait perhaps months to get a court order in order to remove the occupier. If the landlord no longer finds it tolerable to have that person living in his home and the agreement has expired, he should have the right to ask him to go. If we want people again to let spare accommodation in their homes we have to ensure that the law interferes as little as possible.
I turn to Amendment No. 85, which is also part of the group. If I were sharing a bathroom or a toilet with a tenant or licensee of mine, in particular first thing in the morning when there was pressure on these rooms, I should very much regard myself as sharing accommodation with him. Indeed, viewed from the other way round, I felt that I was certainly sharing accommodation when I was in that situation. I believe that the toilet and the bathroom are possibly the most shared rooms in the house. If we were to exclude them from the definition of accommodation in subsections (2) to (4) the resident landlord exclusion would cease to have effect in a very large number of resident landlord cases and I suspect that this is what the noble Lord has in mind.
I shall leave it to the courts to decide whether, on the particular facts of the case and looking at the accommodation as a whole, a landlord and his tenant are sharing accommodation. We do not regard staircases, corridors and passages as accommodation because people do not live in such places. But bathrooms and toilets may be very much part of normal living accommodation. I hope that the noble Lord, Lord Graham of Edmonton, will accept that we are quite clear on this point.
Finally, the noble Lord included Amendment No. 93. This amendment, rather perversely in my view,
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requires that any notice to quit given in respect of an excluded tenancy or licence must give at least eight weeks' notice. There are a number of objections to this. First, we do not see that so long a period of notice is at all appropriate in the cases listed in Clause 31. Perhaps noble Lords would like to consider them: people sharing living accommodation with their landlord, holidaymakers, trespassers and residents in certain hostels. Is it reasonable that a holidaymaker whose contract has come to an end should be given eight weeks' notice, or that a trespasser should be? Secondly, why should the period in this case be eight weeks when for other tenancies and licences it is four? I find that difficult to understand. Thirdly, since there is no obligation to serve a notice to quit on an excluded licensee (comparable to that for tenancies) the amendment is partly defective, but I do not want to dwell on that.
We believe that in the cases falling within Clause 31, with the exception of existing tenancies, the normal common law rules should apply.
Lord Graham of Edmonton: My Lords, I am grateful to the Minister for the care he has taken in rebutting the illustrations that I have given. It is quite clear that the net effect of the Bill will he to narrow the range of those who hitherto have some form of additional or strengthened protection from eviction.
The Minister rests his case mainly upon equity and justice. But it is equity and justice to the landlord, not to the tenant. It may be difficult to argue against the reasonableness of the case made by the Minister. However, I believe that he and his colleagues still fail to perceive that there are hundreds of thousands of people who have to seek accommodation of this kind with private landlords.
Our amendment seeks to make the Bill less burdensome and draconian for people who are already living in wretched accommodation. The Minister says with regard to this part of the Bill that he has got it right. I wonder whose advice he has taken. He has not taken the advice, for instance, of the people who have guided my noble friends and myself not only from their experience but from what they have been told by the people at the sharp end of the housing situation.
I am sure the Minister has listened carefully to representations that have been made by landlords and property associations. No doubt they have a case. In the main it is to make money. For the people for whom I am pleading, their case is to find somewhere decent to live. The Minister has failed to convince me on this aspect of the Bill that he fully appreciates the enormous trauma that hundreds of thousands of people suffer every night of the week in trying to find some kind of accommodation.
The Minister and I would be at one if there were always to be ample good grounds for a landlord to seek possession in the light of either a wayward tenant, a bad tenant or perhaps someone even worse. Of course there will always be people who will deliberately abuse and extend the generosity of a reasonable landlord, but I venture to suggest that the Minister will also realise that, by framing the Bill in the way he has, he is providing many people with an

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opportunity to make more wretched the lives of people who are already in desperate circumstances. But I am afraid that he will not be kind or generous on this occasion though I believe that is to his detriment. Nevertheless I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 84 not moved.]
Clause 31 [Excluded tenancies and licences]:
[Amendment No. 85 not moved.]
Lord Meston Lord Meston moved Amendment No. 86.
Page 23, line 42, leave out ("only") and insert ("for a period not exceeding two months and the tenant or licensee has not been in occupation of the premises for more than two months and for the avoidance of doubt a holiday within the meaning of this subsection is a period of recreation during cessation of work or other normal activity.").
The noble Lord said: My Lords, the purpose of this amendment is to improve the definition of holiday lettings or holiday licences which are to be excluded from the Protection from Eviction Act 1977 under Clause 31. This is an improved version of an amendment moved and withdrawn by my noble friend Lord Ross of Newport at Committee stage. I do not wish to repeat all the arguments, but I remind your Lordships that ever since holiday lets have been an excluded category under the Rent Act they have been seen by unscrupulous landlords as a good loophole and have led to numerous sham agreements. Tenants have found themselves in occupation of unlikely premises under the pretext of holidays which last for a considerable length of time and are taken in improbable places which are not noted for tourism or their therapeutic qualities. I shall not make the mistake of my noble friend Lord Ross of Newport of naming names, because if one were to say that it was unlikely that people would want to spend a holiday in Scunthorpe or Barons Court, someone is bound to say that that is the nearest thing to Heaven on earth.
At Committee stage the Minister said that landlords who misuse holiday let exemptions would run the serious risk of being found by a court to have created a full assured tenancy. That is all very well so far as it goes, but by the time the tenant reaches court the damage which the Protection from Eviction Act 1977 was designed to prevent will already have occurred. By then the tenant will have to find resources, courage and time to take his case to court. The sheer number and persistence of cases of sham holiday let agreements shows that landlords continue to take the risk to which the Minister referred.
By my amendment I hope that we are providing a good opportunity to tighten up the legislation. There should be no doubt on the face of the Bill what is and what is not a "holiday" and "holiday letting". There should be no doubt to landlords that the only exemption is provided for genuine holidays within the normal sense of the expression and for a reasonably limited period. I suggest that the amendment will help the courts to define what is a holiday and will reduce the temptation to evade the requirements of the law. I venture to suggest that
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scrupulous landlords will have nothing to fear from this improvement to the Bill. I beg to move.
9.30 p.m.
The Earl of Caithness: My Lords, I am grateful for the way in which the noble Lord, Lord Meston, introduced this amendment. I am however sad that the noble Baroness, Lady Phillips, who earlier spoke on something similar, is not here to participate in this debate.
I believe that with this amendment we are going over ground which has already been well trodden in Committee here atid in another place. I am afraid that the arguments that I used in Committee on 25th July still apply to this new amendment.
Sham holiday lets are essentially a device to evade the rent and security regime of the Rent Act. With the new shorthold tenancy we are offering landlords a method of using short lets at market rents which give them a guaranteed right of repossession. This has to be attractive to the landlord whose main aim in setting up sham holiday lets is to set market rents for his property. The landlord who sees the attraction of sham holiday lets as being the power to evict without a court order is running a serious risk. If he uses a sham holiday let rather than shorthold, he runs the risk that if the tenancy is examined in court he will be found to have created a full assured tenancy.
I am also afraid that I see the danger of any definition which includes a time limit as being that the unscrupulous landlord will grant lets of just shorter than the time limit, in this case two months. Landlords of houses in multiple occupation, for example, would simply offer tenants successive holiday lets of different rooms in their property, which would be disruptive for tenants. The amendment would also bite on the admittedly rare but known creature, the person who is lucky enough to holiday for more than two months.
I appreciate that the noble Lord, Lord Meston, is trying to tackle a known abuse with this amendment, but I think that the abuse with which he is concerned is one that results from the existing system of the Rent Acts rather than that which we propose. The incentive to the landlord to use sham lets in the future will be significantly reduced because of our shorthold proposals.
Lord Meston: My Lords, while I accept that last point to some extent, the fact is that the Government appear to recognise that there is a device of sham agreements for holiday lets but at the same time are not doing enough to close the loophole. It was to deal, for example, with the bogus holiday lets on a successive basis that this amendment included a maximum period for any such genuine holiday, because it is absolutely right that the exclusion provided by Clause 31 should only cover genuine holidays. Evasion will continue.
It is not so very long ago that one had that strange substance known as Rent Act lino, in the days before the incorporation of furnished tenancies into the full protection of the Rent Act. Landlords would tack a bit of lino on the ground and call it a furnished letting. So it goes on. We now have holiday letting,

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bogus company lets and so forth. These evasions will continue. This is a good opportunity to close the loophole. It would again support the Government in their concern to prevent unlawful harassment and eviction. Nevertheless, given the hour of the evening, I do not propose to press this. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Dean of Beswick Lord Dean of Beswick moved Amendment No. 87:
Page 24, line 11, leave out paragraph (h).
The noble Lord said: My Lords, the purpose of this amendment is to ensure that all residents of hostels and other forms of shared housing owned by housing associations are given some security of tenure.
The present legal status of hostel residents is complex and confusing both for the landlord and the residents. Residents range from those who enjoy the full statutory rights of secure tenancies through to those who are bare licensees, who enjoy very little protection. The Bill as presently drafted increases the rights of hostel residents who hold tenancies, but it worsens the position of many of those who hold licences.
The Bill would allow all licensees to he evicted without the need first to obtain a court order for this purpose. Residents of housing association hostels and other forms of shared housing include some of the most vulnerable people within our society. Shared housing schemes, for example, provide permanent accommodation for people with mental handicap; and it is quite wrong that the residents of these types of schemes, which have been developed with public money, should be denied the statutory rights enjoyed by other tenants. The amendment is therefore designed to ensure that housing associations obtain a court order before evicting a resident from a hostel or other form of shared housing.
When a similar amendment was moved in Committee the Minister said (at col. 113 of Hansard on 25th July):
"There is also the point that much of the accommodation with which we are concerned here is intended for short stays, not permanent residence, and that it is inappropriate to have formal and possibly lengthy procedures of this kind to remove an occupant who no longer has any contractual right to remain there and who has no statutory security either".
Unhappily, this is not now the case. The National Federation of Housing Associations estimates that, partly because of the lack of suitable accommodation for hostel residents to move to, the average stay in housing association hostels is at least a year. Surely this could not be classed as a short stay.
The argument has been used that security should be denied because some hostels have to deal with violent or disruptive residents. The National Federation of Housing Associations believes that it is wrong to deny the vast majority of residents their rights (and housing associations now house over 40,000 people in shared housing schemes) in order to deal with a very small number of disruptive residents. If residents are genuinely violent, surely the police will normally intervene, but in other circumstances
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the association feels that the best solution is to introduce an expedited court procedure.
The Minister has indicated that the Lord Chancellor's Department may look favourably on a limited form of this, but further legislation would be required. But it points out the serious nature of depriving someone of the time to prepare his case. However, that must be set against the proposals of Clause 31, which deprive the licensee of any right to go before a court to present his or her case. The Minister said in Committee (at col. 113) on 25th July that he would look at the issue with a completely open mind.
We feel that we are making progress and that the Minister understands very well the concern of the National Federation of Housing Associations. I wonder whether he could now go a little further and accept this amendment, which we feel to be very sensible. I beg to move.
The Earl of Caithness: My Lords, under the existing law it is not necessary to obtain a court order to evict a licensee whose contract has ended. That seems to the Government to be anomalous, and in Clause 30 we have extended the requirement in the Protection from Eviction Act to obtain a court order so that it covers most residential occupiers. In Clause 32 we have extended the notice-to-quit provisions of Section 5 of the Protection from Eviction Act. There must however he some exceptions and these are set out in Clause 31. They include licensees whose agreements have expired living in hostels provided by the bodies listed in subsection (8).
This amendment removes from the list of exceptions housing trusts which are charities and registered housing associations. I can see the argument for giving all residents of hostels, not just tenants, a safeguard against arbitrary eviction. But the requirement to give four weeks' notice and to obtain a court order in every case could bring real operational problems. The pressure on the county court is such that it commonly takes six to eight weeks for a case to be heard and regrettably in some areas it can take rather longer. So an association wishing to remove a disruptive resident, perhaps because of alcoholism or behavioural disturbance, might have no way of doing so quickly even though that resident was making life intolerable for the other occupants of the hostel.
My department has corresponded with several associations which are very anxious about that problem and which were concerned, wrongly as it happened, that the Bill might make their position more difficult. That seems to me to be a very severe practical drawback to this amendment. It can be argued that a way of helping to deal with this problem is to have an expedited court hearing. Following correspondence with the National Federation of Housing Associations, we have undertaken to look at whether it may be possible, through a change in the court rules, to accelerate the hearing of cases of that kind. However, your Lordships will be aware that giving precedence to those cases means that others have to wait longer.

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Therefore, we are not convinced that this amendment is sensible from the point of view of the practical operation of the hostel. We believe that housing associations are responsible bodies and can be trusted to treat their hostel residents reasonably. Of course they can grant contractual security and minimum periods of notice if they so wish.
Lord Dean of Beswick: My Lords, I am sorry that the Minister cannot go all the way with this
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amendment but I have regard to the undertaking which he gave that the Secretary of State or whoever it may be may well look at expediting court proceedings in those cases.
I believe this is one of those parts of the Bill on which we shall have to keep a close watch when it becomes an Act to see what emerges. On that basis, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
9.42 p.m.
Lord Dean of Beswick Lord Dean of Beswick moved Amendment No. 88:
Page 24, line 20, at end inser—
("(10) A tenancy or licence shall not be excluded by virtue of the provisions of subsections (2) and (3) above if the tenancy or licence was granted in consequence of employment as a domestic servant either by the landlord or licensor or by a member of the family of the landlord or licensor.").
The noble Lord said: My Lords, the purpose of this amendment is to protect the rights of resident domestic servants to be given four weeks' notice in writing of the termination of their right to occupy accommodation and not to be evicted from that accommodation without court proceedings.
Resident domestic servants are currently protected from being harassed or evicted without due process of law by virtue of Section 1 of the Protection From Eviction Act 1977, which applies to all "residential occupiers". Additionally, where that accommodation has been "let as a dwelling" to the domestic servant, there is an entitlement by virtue of Section 5 of the same Act to a minimum of four weeks' notice of termination in writing in a form setting out the rights of the tenant.
Clause 31 of the Bill introduces and defines the concepts of "excluded tenancy" and "excluded licence-, a significant element of which is the use, by the occupier of accommodation, of that accommodation, in common with its owner or a member of the owner's family. Under the terms of the Bill as it stands, all persons falling within that category. including resident domestic servants, will be excluded from the rights aforementioned.
The proposed amendment would expressly exempt resident domestic servants from the effects of Clause 31. The arguments in support of the amendment are that domestic servants are, in the main, low-paid workers with little protection under employment legislation from arbitrary action by their employers. Their vulnerability is considerably worsened where their accommodation is shared with their employer. It is consistent with the spirit of existing and proposed housing legislation to afford these individuals minimum protection against arbitrary and oppressive action which deprives them of accommodation which they have occupied lawfully.
The numbers of persons employed in domestic service appears to be on the increase, judging by the experience of advice agencies and like bodies. The Housing Bill will establish the framework of housing law for years to come, and it is necessary that it takes account of the likely increase in the domestic servant workforce. The proposed wording of the amendment incorporates the term "domestic servant" which has an established meaning in law. I beg to move.
9.45 p.m.
The Earl of Arran: My Lords, we believe the intention behind this amendment is to give protection to people who share accommodation with a resident landlord if they work for them, so that it would be necessary to get a court order to evict someone who worked for you if you shared accommodation with them. With respect to the noble Lord. we think that
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would be intolerable. An employer does, of course, have obligations to his employees, and we would hope all employers with live-in domestic help would treat their employees properly, but we do not see why a live-in employee who shares accommodation with his employer should be in any better a position than a tenant or licensee with whom there is no employment relationship. The amendment would mean that an au pair girl had greater rights than, say, an agricultural worker living in the farmhouse with his employer. There is no logical reason for this. If the parties cannot live happily together, the landlord should have the right to possession without a court order, regardless of their employment relationship.
Some noble Lords may think we are still living in the era of Jeeves and Bertie Wooster, but I can assure them that in this era of working wives and single parents, quite a lot of people of modest means have live-in employees, and it would cause a considerable stir if we were to accept the noble Lord's amendment. I am afraid I shall have to ask the noble Lord to withdraw it.
Lord Dean of Beswick: My Lords, I am grateful to the Minister for that brief reply to the amendment. I was somewhat amused to hear him in effect suggest that I was seeking to protect au pair girls. I was not aware that they needed much protection.
The Earl of Caithness: Oh‡
Lord Dean of Beswick: My Lords, I was not speaking for myself but for other people. I listened carefully to the Minister. The amendment needed a Government response. I am, of course, aware of the difficulties where people share accommodation with their employer but it is right to point out that the evidence produced for me is that this type of employment is on the increase and will continue to increase. It may be that at some stage in the future the Government will have to come back to consider a situation that is becoming increasingly difficult. Having said that, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Meston Lord Meston moved Amendment No. 89:
Page 24, line 20, at end insert—
("(10) A tenancy or licence is excluded if it was not granted in consideration of money or money's worth.").
The noble Lord said: My Lords, with this amendment I invite your Lordships to consider the position of the bare licensee—and, I hasten to say, it has nothing to do with an au pair girl. It covers a point raised in passing in Committee during an exchange between my noble friend Lord Ross of Newport and the Minister as to the status of the bare licensee; that is, a person occupying premises free of charge without any mutual intention to create legal relations.
My noble friend expressed surprise at the omission of the bare licensee from the list of excluded people in Clause 31. The noble Earl said that bare licensees were not, in principle, any different from other

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licensees and therefore were, prima facie, entitled to notice and to a court order. However, there can be the world of difference between a licensee who occupies premises as a result of payment or the provision of services and the bare licensee who is often little more than a non-paying guest and who certainly would not think of himself as having any legal label but who, in fact, the courts would regard as a bare licensee.
For example, if this amendment were not to be accepted one can imagine a situation where an owner occupier leaves his or her house, perhaps in a hurry, to take up new employment a long way away and allows a friend or an acquaintance to stay in the house rent-free while the sale is being negotiated. If at the end of that period of grace the licensee should fail to go when asked, the benevolent owner might find himself or herself unable to give vacant possession on the date provided for completion of the sale. As a result there may be dire consequences.
Of course it is unlikely that that will happen in the great majority of cases because good sense and good manners will prevail. But bearing in mind that human nature is not always perfect, I suggest that it is both logical and sensible to provide for the situation that I have described, which does not seem to be covered by any of the other exclusions in Clause 31. For example, it would not be covered by the shared accommodation exclusion at the beginning of that clause. It is clearly right that that kind of category of person should be outside the requirements of the law in this area.
The Deputy Speaker: My Lords, I believe that there is a misprint in this amendment on the Marshalled List. "Licensee" probably means "licence"; is that correct?
Lord Meston: That must be right.
The Deputy Speaker: Perhaps noble Lords will read it as such.
The Earl of Arran: My Lords, let us see whether we can reassure the noble Lord, Lord Meston, on this amendment. This is a subject that the noble Lord, Lord Ross, raised at Committee stage. We fully appreciate his argument that the landlord or licensor who, out of the kindness of his heart, lets a friend live in accommodation he has spare might be rather shocked to find that, if the friend repays his kindness by refusing to go, he has to obtain a court order to evict him. We put it to the noble Lord that in the majority of cases we are talking about resident landlords letting their spare rooms to their friends, and of course if they share accommodation no court order is necessary. Not many people have spare properties they can afford to let entirely rent free, even to friends out of the kindness of their hearts.
However, if there are such people it will come hard on them to find that they have to go to the expense of getting a court order to turn out the tenant or licensee if the relationship goes sour. On consideration we believe that the noble Lord has force in his arguments. We therefore undertake to bring forward
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an amendment at Third Reading to give effect to the intention of his amendment provided that he now sees fit to withdraw it.
Lord Meston: My Lords, I am most grateful for the noble Earl's response and I accept his invitation. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 90 to 94 not moved.]
Clause 34 [New protected tenancies and agricultural occupancies restricted to special cases]:
[Amendment No. 95 not moved.]
The Earl of Arran The Earl of Arran moved Amendment No. 96:
Page 26, line 4, after ("court") insert ("considered that, in the circumstances, the grant of an assured tenancy would not afford the required security and, accordingly").
The noble Earl said: My Lords, in moving Amendment No. 96 I should also like to speak to Amendment No. 100. These are small but useful amendments. They deal with cases where a landlord is seeking possession of his property on one of the grounds involving the provision of suitable alternative accommodation. In the course of those proceedings the court directs that the tenancy of the suitable alternative accommodation will be held under a protected tenancy or a secure tenancy, according to the type of tenancy in question. These amendments make it clear that in directing that the new tenancy will be a protected or a secure tenancy, the court does so because it does not believe that an assured tenancy would offer the required security. The amendments thus clarify the position and guide the court. I beg to move.
Lord McIntosh of Haringey: My Lords, the noble Earl is right to say that these amendments clarify the position. What they do not do is to meet a government commitment made in Committee. I am surprised that the noble Earl did not see fit to mention that fact.
At the moment the Bill says that a new tenancy cannot be a Rent Act protected tenancy unless it is granted to an individual or to joint tenants in certain circumstances; if it comes after a court possession order made on the basis that suitable alternative accommodation is available and the tenancy is of that alternative accommodation; and when the possession order was made the court directed that the tenancy would be a protected one. The Government are quite right. They are now changing the words "the court directed" to,
"in the circumstances, the grant of an assured tenancy would not afford the required security and, accordingly directed that the tenancy would be a protected tenancy".
The onus is now put on the county court to decide whether the proposed tenancy is reasonably equivalent in regard to security of tenure.
Perhaps I may remind the noble Earl that in Committee we moved an amendment which went further than this. It said that,
"a tenancy which is an assured tenancy within the meaning of Part I of the Housing Act 1988 shall not be treated as affording the required security by reason only of the fact that the tenancy is an assured tenancy within the meaning of the Housing Act 1988".

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At col. 123 of the Official Report for 25th July the Minister said:
"There is no doubt that the noble Lord has hit on a good point here. We accept the principle behind the amendment. If he will withdraw it at this stage, we can deal with the point at a later stage".
I withdrew the amendment at that time. Although I do not expect him to answer now, I expect to have an answer from him before the next stage of the Bill. The amendment he proposes is for clarification but it does not meet the point which we made in Committee. I do not say that we oppose the clarification but we need to go further than the amendment does.
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 97:
Page 26, line 20, at end insert—
("(2A) In any case where—

(a) by virtue of subsections (1) and (2) above, a tenancy entered into on or after the commencement of this Act is an assured tenancy, but

(b) apart from subsection (2) above, the effect of subsection (1)(b)
above would be that the tenancy would be a protected tenancy, the tenancy shall be an assured shorthold tenancy (whether or not it fulfils the conditions in section 20(1) above) unless, before the tenancy is entered into, the landlord serves notice on the tenant that it is not to be a shorthold tenancy.").

On Question, amendment agreed to.
[Amendment No. 98 not moved.]
Clause 35 [Removal of special regimes for tenancies of housing associations etc.]
The Earl of Arran The Earl of Arran moved Amendment No. 99:
Page 27, line 13, at end insert—
("(2A) Where, on or after the commencement of this Act, a registered housing association, within the meaning of the Housing Associations Act 1985, grants a secure tenancy pursuant to an obligation under section 554(2A) of the Housing Act 1985 (as set out in Schedule 16 to this Act) then, in determining whether that tenancy is a housing association tenancy, it shall be assumed for the purposes only of section 86(2)(b) of the Rent Act 1977 (tenancy would be a protected tenancy but for section 15 or 16 of that Act) that the tenancy was granted before the commencement of this Act.").
The noble Earl said: My Lords, in moving Amendment No. 99 I should like to speak to Amendment No. 101. These amendments need to be read together with paragraphs 51 and 52 of Schedule 16. When those paragraphs were inserted by amendment at Committee stage we said that these further amendments would need to be made to Clause 35. Their effect is simply to ensure that where a registered housing association buys back from an occupier who was a former secure tenant of the association under the defective housing provisions of the Housing Act 1985 a dwelling and grants a new tenancy to that occupier, the tenancy can be a secure tenancy at a fair rent. The same arrangements will apply where the dwelling is bought back from certain other people connected with the former secure tenant; for instance, his or her spouse. So this makes a further limited exception to the general rule that in future housing associations will grant new style assured tenancies under the Bill rather than secure tenancies. But in these special circumstances I am sure all would agree that the exception is justified. I beg to move.
On Question, amendment agreed to.
The Earl of Arran The Earl of Arran moved Amendments Nos. 100 and 101:
Page 27, line 43, after ("court") insert ("considered that, in the circumstances, the grant of an assured tenancy would not afford the required security and, accordingly").
Page 27, line 44, at end insert ("or
(f) it is granted pursuant to an obligation under section 554(2A) of the Housing Act 1985 (as set out in Schedule 16 to this Act)").
On Question, amendments agreed to.
10 p.m.
Clause 36 [New restricted contracts limited to transitional cases]:
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 102:
Page 28, leave out lines 20 to 29.
The noble Lord said: My Lords, in moving Amendment No. 102 I should like to speak also to Amendments Nos. 103, 234 and 237. The amendments return to the issue of the resident landlord. They are an attempt to deal with what appears to us to be an anomaly which cannot have been intended. The House rejected the amendment moved by my noble friend Lord Graham which attempted to restrict the definition of a resident landlord; for example, by excluding the common occupancy which consists only of a bathroom or WC. Therefore the question is that much more severe than it need otherwise have been.
Clause 36, subsections (2) and (3), which would be deleted by Amendment No. 102, state that if the existing tenant of a resident landlord agrees to the landlord's request for a rent increase which has not come about through a rent tribunal, the tenant loses the Rent Act right to apply to the rent tribunal in future. He also loses the benefit of the county court discretion to extend the possession order which the landlord is entitled to without having to prove grounds for possession by up to three months.
The Government have made much of the balance between landlord and tenant and of the advantage of negotiation between landlord and tenant as opposed to legal action. Although we are deeply suspicious about the way they place the balance between landlord and tenant, we agree with them that where issues between landlord and tenant can be met by negotiation rather than by going through the courts that is clearly preferable. Therefore when we have a position where a tenant of a resident landlord, being a reasonable sort of person, says, "Yes, after all these years it is time I paid a bit more in rent", he will then discover—not having been anywhere near a court, a local authority, a citizens' advice bureau, his local ward councillor, his Member of Parliament or anyone else to get advice—the true effect of such an agreement.
He is the kind of person who is not accustomed to complaining; he is not accustomed to seeking public support on any matters. But he says, "Yes, it is reasonable that I should now be paying a bit more rent". He does not realise that the effect of that will lose him the right to apply to a rent tribunal in future and the benefit of the county court discretion.
Surely that is not what the Government were saying. In their original White Paper and in the various consultation papers they said that existing tenants' protection would not be reduced. A tenant may agree to a reasonable request. Sometimes tenants will agree to even more than that; they may even say to the resident landlord, who is presumably someone to whom they are quite close, "It is time I paid you a bit more". But if they do that without knowing that they are agreeing to a reduction in other rights, surely then the existing tenant's protection is being removed. It is being done in a way that conflicts with what the Government have proclaimed as a principle of the Bill in their White Paper and in the various consultation documents.
Amendment No. 103 is something of a fallback position. If Clause 36 is to remain unchanged and if subsections (2) and (3) are not to be removed, there must be some way of informing the tenant of the true effect of agreement to an increased rent. Therefore it seems sensible that the landlord must include basic information when he gives notice of the increase.
On 21st July the Minister said (at col. 1535 of Hansard), when we were talking about the possibility of an assured tenant losing rights when a new landlord moved in,
"I agree that there is a risk that an assured tenant could lose his rights…if he accepted a new tenancy without understanding the significance of doing so".
In Amendment No. 103 we are offering the Government an opportunity to give effect to the recognition which the Minister gave in Committee and to ensure that adequate information is given. I must say that I should prefer Amendment No. 102. I should prefer us to take out the possibility of tenants losing rights. But, if that is unacceptable to the Government, I put it to them that they ought, in all honour and in recognition of what was said in Committee, to accept Amendment No. 103, which although not ideal is better than the existing situation.
Amendment No. 234 relates to Schedule 16 which refers to the duty of a landlord when tenanted property is sold to give written notification to the tenant of the name, address and further particulars of the new landlord. That again is a matter to which the Minister referred in Committee on 25th July when he said that he would consider that matter further between then and another stage. Here we are at "another stage" and I invite the Minister to tell us what consideration he has given. I hope the result of that consideration will be that he will feel able to accept the amendment.
Amendment No. 237 relates to long leaseholders, and ensures that they do not lose the right of first refusal under the Landlord and Tenant Act 1987 which is a fairly recent Act which should not be changed in any significant way. Again, I hope that the Government will agree with that proposition and with the amendment which has been tabled. The amendments all deal with a similar issue. They are designed to give effect not only to undertakings given by the Government in Committee but to the assurances given to the general public during
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discussion of the Housing Bill that existing tenants' rights would not be affected. I put it to the House that the way to ensure that that happens is to agree preferably to Amendments Nos. 102, 234 and 237. I beg to move.
The Earl of Arran: My Lords, we shall acccept the invitation of the noble Lord, Lord McIntosh, to demonstrate the consideration that we have given to the amendments. Noble Lords will forgive me, but it will take a short time to do that because they are somewhat diverse.
Clause 36 concerns restricted contract holders, most of whom are tenants or licensees of resident landlords. One of the aims of the Bill is to remove most of the remaining statutory controls over that form of letting because we are convinced that there is a lot of spare accommodation in people's homes which they would be prepared to let if they knew that they could do so without statutory restrictions.
In fact existing restricted contract holders have few rights under the Rent Act, as amended by the Housing Act 1980. They may apply to the rent tribunal for the registration of a reasonable rent, but in practice the vast majority of such applications are made by local authorities where the tenant has claimed housing benefit. Those with contracts granted before 1980 can also apply to the tribunal to suspend a notice to quit for up to six months, but there are now very few such applications. That is hardly surprising since the number of lettings by resident landlords dating from before 1980 cannot now be very great. Post-1980 contract holders do not have the right but the court has discretion to suspend possession for up to three months rather than the normal six weeks. So those rights do not add up to very much but they may well deter householders who are afraid of becoming entangled with so notorious a piece of legislation as the Rent Act.
Under the Bill the right to apply to a rent tribunal for a reasonable rent and the extended discretion of the court to suspend possession are removed for future contracts. The Bill provides that in certain circumstances a change in terms of the existing contract shall be regarded as giving rise to a new contract. This is necessary because otherwise a landlord who wished to be able to charge a market rent, free of the risk that the tenant would refer any increase to a rent tribunal, might be induced simply to evict the existing occupier and to find a new one. He might well be able to do this because the occupier, as I have said, has no statutory security. So this apparently rather severe provision is actually logical and necessary and the first amendment deleting it is not acceptable.
We have some sympathy with the second amendment, Amendment No. 103, which seeks to ensure that the occupier understands the significance of accepting a variation of terms. But again we cannot see any point in imposing this requirement on landlords when they have the simple alternative of evicting the occupier. So, well meant though this amendment is, we cannot see that there is a great deal of point to it.

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Turning to Amendment No. 234, this is almost identical to Amendment No. 174 which we discussed on 25th July and which the noble Lord withdrew when we undertook to consider the issue which it raised. We have now done that and have concluded that this amendment is unnecessary. We explained in our earlier discussion the battery of provisions continued in the Landlord and Tenant Acts 1985 and 1987, which are designed to ensure that a tenant knows who his landlord is.
All this was fully considered by the Nugee Committee, which we set up to look at issues of this kind and whose recommendations form the basis for the 1987 Act. Nugee considered whether a new criminal offence on the lines of this amendment was needed to supplement the existing offence in the 1985 Act. This provides that it is an offence if the person who collects the rent or the landlord's agent fails to supply the landlord's name and address if a tenant asks for it.
The committee decided against recommending further criminal offences. The problem with criminal offences is that they provide an effective deterrent or incentive only if they are enforced. This amendment would work only if local authorities were prepared to prosecute offenders. The Nugee Committee took the view, very wisely it seemed to us, that it would be better to give landlords some other more effective incentive to comply. That was the origin of Sections 47, 48 and 50 of the 1987 Act. Section 50 provides that a landlord who sells a dwelling remains responsible for the landlord's obligations under the tenancy until the tenant is told who the new landlord is. So he has a strong incentive to tell the tenant himself or to ensure that the new landlord does.
Section 47 provides that a written demand for rent or service charges must contain the landlord's name and address and, if the address is outside the jurisdiction of the High Court, an address in England and Wales at which notices and proceedings may be served upon him. If this information is not provided, the tenant is not liable to pay any service charge demanded unless and until it is forthcoming. These sections and Section 48, which require a landlord to notify tenants of an address for service of notices, have significantly strengthened the tenant's position as regards his ability to identify and contact his local landlord. It really makes no difference to the tenant who provides him with this information and we see no advantage in imposing a duty on the former landlord after he has assigned his interest, given that there is already a duty on the new landlord.
The point about these provisions of the 1987 Act is that they are self-enforcing. That is why the Nugee Committee recommended them rather than something on the lines of this amendment. So we believe that the amendment is not needed. In these circumstances, I ask the noble Lord, Lord McIntosh, to withdraw his amendment.
In conclusion, we have some sympathy with Amendment No. 237. It is the intention that long leaseholders should be qualifying tenants for the purposes of Part I of the Landlord and Tenant Act 1987 and that they should therefore have the right of first refusal when the landlord wishes to sell his
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interest in the building. It is true also that long leases could be assured tenancies and, we suppose, assured agricultural occupancies within the meaning of Part I of the Bill if they meet the qualifying conditions. However, we should have thought that there would be relatively few long leases to which this would apply. We certainly think that it is doubtful whether a landlord would seek, in granting a lease, so to arrange things that it was also an assured tenancy simply to avoid the 1987 Act. There would be disadvantages for him if he did that. He could not, of course, be sure that it would remain an assured tenancy.
We can see why the noble Lord has tabled this amendment. Although it is not actually harmful, it seems to us to introduce an unnecessary complexity into an Act which has already been criticised for being too complex. I apologise for having to take such time in rebutting the amendments of the noble Lord, Lord McIntosh, but they have taken some time to explain.
10.15 p.m.
Lord McIntosh of Haringey: My Lords, I certainly do not accept that the Minister has rebutted my amendments. He expressed considerable sympathy with Amendments Nos. 103 and 237. I suppose I must be grateful for that. But the lengthy explanation is only necessary because the Minister has the responsibility of explaining to the House why the unequivocal promises given by successive Ministers throughout the whole consideration of this Bill and since the time the concept of the Bill was first introduced, that existing tenants' rights would not be eroded, are broken in the Bill. That is the fact of the matter. Existing tenants' rights are eroded by these provisions. The amendments are designed to deal with that fact.
It is not good enough for the Minister to say that the protection which exists under present circumstances for tenants of resident landlords does not add up to very much. He gives the lie to that by going on to say that although it may not add up to very much, nevertheless landlords are afraid of it because it gets them into the complexities of the Rent Acts. If it does not add up to very much, why should landlords be afraid of it? If landlords are afraid of it, surely there is something here which deserves to be protected; that is if we are to believe Ministers who have consistently said that existing tenants' rights shall not be eroded.
I shall not insist on Amendment No. 102. I did not expect the Minister to be sympathetic towards it. I am, however, deeply disappointed by the response to Amendment No. 103. I am appalled by the suggestion that the landlord has—I quote the exact words used—
"the simple alternative of evicting",
the tenant.
It is because we wish to avoid that alternative, and because we wish to continue the possibility of a rent being changed by negotiation without going to the rent tribunal and without loss of rights, that we have put forward Amendment No. 103. This is not an appropriate time of night for me to take the opinion

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of the House. But I give notice that we consider this to be a breach of faith. Unless the Government can find some way of giving effect at Third Reading to something with whose intention they agree, we shall certainly have to raise this matter again and try to give effect to the Government's own promises.
I shall not pursue the matter of Amendment No. 234, but Amendment No. 237 is not rebutted by simply saying that there is not a very large number of long leases and that it is too complicated to put a provision on the face of the Bill.
We have put forward a very simple amendment whose objectives are common ground between us. We are saddened that the Government, for the sake of simplicity, should abandon those long leaseholders who have rights. We have not received a satisfactory reply. We shall certainly have to think about this matter again, but in the meantime I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 103 to 111 not moved.]
Clause 45 [Interpretation of Part I]:
[Amendment No. 112 not moved.]
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 113:
Page 35. line 4, at end insert—
("(5) For the avoidance of doubt, it is hereby declared that, in this Act, tenancy means—
Any grant of a right to occupy a dwelling-house as a residence, with exclusive possession for a term, for payment, where the parties intend to create legal relations.
A tenancy shall exist notwithstanding that in the case of an agreement amounting to joint exclusive possession. the lawful joint occupants have entered into possession at different times.
In construing documents purporting to be agreements to grant rights to occupy dwelling-houses, the courts shall have regard to the true nature and effect of the transactions, and determine it from all the circumstances, including the conduct of the contracting parties, and they shall be astute to detect cases where the documents do not reflect the true nature and effect of the agreement.").
The noble Lord said: In moving this amendment we appreciate that we are attempting to deal with something which is still before the courts. We are aware that the issue of non-exclusive occupational licences or, in real terms, "sham" licences has not been clarified since the matter was considered at Committee stage. One Court of Appeal judgment—Street v. Mountford—seemed at the time to be conclusive. Other cases are still before the Judicial Committee of your Lordships' House—Antoniades v. Villiers and AG Securities v. Vaughan. We are still hoping that the judgments on those cases will be available to us before we have finally to dispose of this Bill early next month.
If the House of Lords reaches a similar conclusion as the Court of Appeal on Street v. Mountford, that will be all right because it will mean that most of the licensees will be considered as tenants. If the judgment were to go the other way it would still be legal for landlords to evade their responsibilities by choosing licences instead of assured tenancies or even assured shorthold tenancies. In our view that would
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be a serious denial of basic rights. The creation of the excluded licence for which this Bill provides would make the matter worse.
With this amendment we are in effect trying to prejudge the decisions of the Judicial Committee. To lawyers that may appear a terrible thing to do. However we are allowing for the possibility that a conclusion may be reached by your Lordships in their judicial capacity which would leave the law in an unsatisfactory state. We do not believe that it would be good enough for us to do as the noble Earl suggested we should do when we considered the matter in Committee—namely, leave the matter to further legislation. I believe that he said that it would not be housing legislation but that it would be landlord and tenant legislation. That might well be two or even three years in coming.
In the meantime the sham licences procedure would represent a serious gap in the legislation. It would allow landlords the right to evade their responsibilities under the assured tenancies provisions in a manner which has not been intended by the Government and which could be avoided by accepting the present amendment. I beg to move.
The Earl of CaithnessMy Lords, I believe that the noble Lord, Lord McIntosh of Haringey, summed up the problem facing your Lordships very succinctly when he wondered whether we should try to prejudge the decision of the Judicial Committee of your Lordships. The answer to that is, no, I do not care to prejudge that decision. I think that it would be entirely wrong if your Lordships were to do so.
Perhaps I may update the House on the situation. I shall not repeat word for word what I said in Committee. As your Lordships will know, leave was granted in both cases—A. G. Securities v. Vaughan and Antoniades v. Villiers—to appeal to your Lordships' House. I understand that the cases were heard earlier this month and that the judgments are likely to be delivered in November. I cannot anticipate the outcome of those judgments, and I believe that the best way forward—although it will not entirely satisfy the noble Lord, Lord McIntosh of Haringey—is to wait for them to become available.
Lord McIntosh of Haringey: My Lords, of course that answer is not satisfactory because it means that if we do not have an opportunity to introduce an amendment to close the gap so to speak, the law could be—as was not intended, and I think that is common ground—uncertain for a considerable time to come.
It is not in any way a criticism of the Judicial Committee of your Lordships' House when I say that if the law is unclear and if it is necessary for the Judicial Committee to issue an interpretation of the law which is in conflict with what we would want the law to be—although the committee consists of experts on what the law is—we should take the opportunity that is before us to clarify the situation and make sure that in the future the law does what all parties, including I think the Government, want it to do.

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There is no disrespect at all intended toward the Judicial Committee in this amendment. We are trying to avoid a quite unnecessary and damaging interregnum. I can see that I shall not convince the Minister and I am sure that my remarks horrify all the lawyers in your Lordships' House. The only wise solution is to withdraw the amendment at this time. However, if things go wrong, I give warning that the Government will be blamed. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Earl of Arran: My Lords, I beg to move that consideration on Report be now adjourned.
Moved accordingly, and, on Question, Motion agreed to.
House adjourned at twenty-seven minutes past ten o'clock.