§ The Parliamentary Under-Secretary of State, Office of the Deputy Prime Minister (Mr. Tony McNulty)On 22 July 2002, we laid before Parliament a draft Regulatory Reform Order to reform the workings of Part 2 of the Landlord and Tenant Act 1954. The Act provides a framework for the renewal and termination of business tenancies, and the aim of our reforms was to make the process quicker, easier, fairer and cheaper.
The Order has undergone its first stage of Parliamentary scrutiny, and the House of Lords Delegated Powers and Regulatory Reform Committee and the House of Commons Regulatory Reform Committee published reports shortly before Christmas. I am grateful to the Committees for their thorough examination of our proposed amendments. I welcome their support for the bulk of our proposals to reform this complex and highly technical legislation.
The Committees had some reservations on our proposals to change the way in which landlords and tenants may agree to contract a business lease without the normal statutory rights of security of tenure. The Regulatory Reform Committee made specific recommendations to enhance the protection for tenants. However, the Committee on Delegated Powers and Regulatory Reform had more fundamental concerns at the lack of evidence about the degree of protection that the courts provide, and hence whether our proposals to abolish the requirement for a joint application to the courts would remove necessary protection from business tenants.
We acknowledge that while there is considerable anecdotal evidence, there is a lack of definitive statistical evidence about the outcome of applications to the court for approval of agreements to exclude security of tenure. We therefore propose to carry out research to indicate the outcome of recent applications to the court for approval to exclude security of tenure. The research will study the proportion of applications rejected and the reasons for rejection. We will also undertake some further consultation of organisations representing small businesses.
We propose to present the research findings and the outcome of the further consultation to the Committees. Subject to the outcome of the research and consultation and the views of the Committees, we would then lay for second stage scrutiny an amended draft Order incorporating the amendments suggested by the Regulatory Reform Committee and slightly modified in certain other detailed respects.