Source: https://api.parliament.uk/historic-hansard/lords/1974/jul/01/rent-bill-hl
Timestamp: 2019-04-21 14:08:16+00:00

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§ Lord BETHELL moved Amendment No. 1: Page 1, line 7, after ("date,") insert ("subject to subsection 1A below—").
§ The noble Lord said: My Lords, I beg to move Amendment No. 1 and I hope it will be for the convenience of the House if I also speak to Amendment No. 2. The purpose of these two Amendments is to reduce the rateable value limit on which protection under the Bill will come into effect for furnished accommodation. Your Lordships will recall that the rateable value limit was changed by the previous Government about a year ago, and that under the present rateable system it now stands at £1,500 for residential units in London and £750 outside London. Any unit above this figure which is unfurnished has no protection. But, there are very few residential units that fall into this category. I believe that there are probably less than 10,000—just a few thousand in the whole country—so it is a question of 99.9 per cent. in one category and 0.1 per cent. in another, and I suggest that it would be more practicable and advantageous to reduce this figure only with regard to furnished accommodation under the legislation that is proposed under this Bill. This would mean that residential units at half the proposed figure—that is, £750 for residential units in London and £375 for units outside London—would not, if they were furnished, have the protection proposed under the Bill.
§ The reason why I am suggesting this Amendment is indicated by a certain amount of research I have done, which 70 shows that a flat or a house in London with a rateable value of £750 would, on average, command a furnished rent of £75 a week and might, at the top end of the market, command a rent of £125 a week. This information has been given to me on the basis of research conducted by the agents Chestertons who act, among other clients, for the Church Commissioners. I hope your Lordships will agree that there is nothing "Rachmanite" about them and that any information gathered by this most respected firm is likely to be accurate. We are therefore discussing residential units in central London which would have an average weekly rent of £75, around twice the wage for an industrial worker. I ask your Lordships to consider whether it is appropriate that this Bill should provide protection for tenants who will be paying this sort of rent—£75 a week.
§ Probably most of your Lordships on both sides of the House sympathise with the plight of people who are in this position, and who face the danger of homelessness if they do not have protection. I do not qaurrel with that Part of the Bill which seeks to help them. But the Bill, as was also indicated by the noble Lord, Lord Garnsworthy, has been drafted in a rather complicated way and there is a certain feeling that it was done with a lot of haste. Therefore, it may have certain unfortunate side effects which the House should be very careful about and should know about. One of the side 71 effects is that the Bill as at present conceived will have a very serious effect on the present market of furnished flats now available to transients, particularly in London.
§ I suggest that it is very important that the city of London, which is one of the great world centres, should continue to have a large number of furnished flats and houses available for diplomats, representatives of foreign companies, foreign individuals who come here, people who come from other parts of the country for short terms of a year or two, for people moving jobs and coming to London briefly, perhaps looking for a house or intending to stay only for a year or two for a term of duty to which they have been assigned by the organisation for which they work. It is these people who need the service which is provided by the private sector of furnished accommodation. Without this service one does not quite know what they would do. They may decide not to come to this country if they cannot find accommodation for a year or so. They may decide to go elsewhere. I am thinking now of wealthy individuals from overseas who are looking for a place to live. They may decide to buy accommodation. Embassies and companies may decide that instead of going to the private sector they will buy blocks of accommodation in London.
§ The result of this would be that pockets of residential accommodation would very soon be in foreign hands and the income from the service would cease, with a consequent loss to the balance-of-payments situation and to the Exchequer. A further consequence might be that people coming to this country for a few months or perhaps a year may be forced to turn to hotels. This might be the only recourse left open to them; they would find themselves forced to take two rooms or a suite in a hotel. The result would be to put up the price of hotel accommodation and to make the hotel situation even more acute than it is now, and in a thoroughly artificial manner. Normally someone coming for as long as six months or a year would not stay in a hotel but would find a furnished flat. If this Bill is passed without something like the Amendment which I have put down, it seems to me extremely unlikely—and I have already declared my personal interest 72 in this matter and have taken some advice—that private landlords who provide this service will continue to do so.
§ It would be commercial madness, my Lords, for a landlord who is obtaining a rent of, say, £75 a week for a flat (he is not, of course, making a profit of £75 a week because he is providing furniture which cost several thousand pounds; he has to maintain his flat to a high standard of decoration at a cost of several hundred pounds a year; he has to provide services and to replace the furnishings and fittings to keep it to the sort of luxury standard we are talking about) to provide this service if the flat is let to an individual or to sharers who are able to obtain security of tenure and go to a rent officer or a rent tribunal and obtain a fair rent which excludes the element of scarcity. I have taken advice and my advice is that this would probably reduce the weekly rent of such a flat from £75 to between £35 to £40. It would be commercially impossible for a landlord to continue in business in this way.
§ My case is that above a certain level the ordinary market forces should be able to apply, and it should not be necessary for the Government or the local authority to step in as the guardian of the tenant because the tenant of such accommodation does not need the protection of the authorities in his battle against the landlord. It is sufficient for him to be able to negotiate with the landlord on a free basis and to sign whatever agreement he can achieve. If this Bill goes through without some such amendment I suspect that landlords will wait until they gain possession of the flats which are being let at these high rents and will not relet them, but will wait to see whether the Government reconsider and make some provision for the service they are providing; and then will sell the flat or the house for owner-occupation. It would be crazy of them to take the risk of allowing to move in a tenant who might then gain security and have the rent reduced and remain in the flat for a number of years. I would ask the Government to consider whether they need to provide security for people paying the sort of rents I have been discussing.
§ The noble Lord, Lord Avebury, in his speech on Second Reading suggested that the private landlord was a dying animal, 73 someone who was disappearing off the face of the earth. I dare say there are noble Lords who would think that that was a good thing; but to me—and to many other noble Lords who sympathise with the general purpose of this Bill and who have no wish to see homelessness inflicted on any person in this country—it would seem hopeless to abolish this particular service which is provided for people who do not need protection. It is quite right for the Government to curb landlords who have too much power and who are in a position, at a few months' notice, to evict young married couples from a flat. It is absurd that people who have a furnished flat as their only home should be able to obtain only a few months' protection. Certainly until the housing situation is in a far better state than it is now they need more protection. With the Bill in its present form I would suggest that by abolishing one social evil the Government are having little regard to the harmful side effects of their legislation, one of which will be the disappearance of high quality flats available as short term London residences.
My Lord, I am grateful to the noble Lord, Lord Bethell, for his general support of the purpose of this Bill and the lucid way in which he has moved his Amendment. The effect of the Amendment, as he said, would be to provide that no furnished tenancy would become protected if the rateable value of the dwelling-house was more than half the rateable value limits currently fixed for protected tenancies by virtue of Clause 1 of the 1968 Act, as amended by the Counter-Inflation Act of 1973.
The noble Lord, Lord Bethell, has again raised the subject of the effect that this Bill would have on furnished accommodation provided by landlords, such as himself, for the use of foreign diplomats, businessmen and rather wealthy visitors staying temporarily in this country, particularly, of course, in London. He has expressed concern that these visitors will no longer be able to find accommodation suitable for their needs. I am afraid I will have to repeat what I said in Committee when the noble Lord raised this same point on the Question, That the Clause stand part of the Bill? I repeat, 74 I cannot accept that what he is seeking to achieve is either necessary or desirable.
I emphasised in Committee that where furnished accommodation is taken by a Government or by a limited company on behalf of a member of their staff the Government or the company would, under no circumstances, claim Rent Act protection once a contractual tenancy has come to an end. I admit that there is nothing to stop an individual diplomat or businessman to whom a tenancy is granted from claiming protection, but I cannot seriously believe that there will be many foreign visitors who would ever have occasion to do this. I certainly would not agree with any proposal to restrict the scope of the protection we are giving to furnished tenants. The reasons which led us to support the previous Government in extending protection to higher rateable value unfurnished tenancies apply with equal force in the furnished sector now that this will be protected. The noble Lord suggests that expensive furnished accommodation does not provide homes in the sense that we understand that term. But people who are desperate for accommodation are forced and will be forced into the unprotected market and be subject to the high rents and insecurity which we are determined to get rid of.
I should like to remind the noble Lord and the House that his proposal would exempt from protection not only the expensive furnished flat used by the visiting diplomat or businessman, but also that accommodation which has a rateable value between £750 and £1,000 in Greater London. which may well be occupied as homes by long-term residents. I gave most careful consideration to what the noble Lord said in Committee, and considered whether I would be justified either in accepting the Amendment on the Marshalled List, or in seeing whether there was any way around the difficulty. However, I have come to the view, which I ask the House to accept, that we should treat furnished tenancies in the same way as we have treated unfurnished tenancies in the past, and use the same rateable value as the guide. I very much regret to have to say to the noble Lord that we are not in a position to accept his Amendment.
My Lords, I wonder whether I might press the noble Lord, Lord Shepherd, to reconsider this matter, in spite of the fact that he has said—and, indeed, I am very grateful to him for it—that he has already given it further consideration. It is perfectly true that the Amendment may not be correctly drafted, but its aim is to meet what appears to me and to my noble friend Lord Bethell a rather exceptional case. It seeks to remove from the protection of this Bill only the most expensive flats, the kind of flats occupied by people who may well come to London because it is the capital city and the centre for commerce and business, and not in the way they would go to other places. Because of that they bring in foreign currency, contribute to our balance of payments and no doubt contribute, directly or indirectly, to the economic growth of our society.
The second group of people who will be concerned are those who may come through foreign embassies. I should like to know whether the Government have had discussions with the Foreign Office on this point because, as I understand it, if a flat is let to an individual and not through an embassy, the individual will have security of tenure under Clause 1. Therefore, in a world in which Governments do not always seem to be as stable as we should like, there could be difficulty for a Government in finding accommodation for other officials. In this Amendment we are not talking about tenants who need protection because they are likely to become homeless, or because they are poor and cannot afford to find other accommodation. We are talking about tenants who are able to pay at least £75 a week. I hope that the noble Lord, Lord Shepherd, will feel that such people do not need the protection of this Bill, and that he will look at the principle and see whether he can find some way of meeting it.
My Lords, I should be the last person to resist the approaches of the noble Baroness on this matter, but I will be honest with the House. I have looked at this matter and have discussed it with my advisers, and I have come to a view which I believe is shared by my colleagues. What I can 76 undertake to do—and I hope this will satisfy the noble Baroness—is to draw her remarks and those of the noble Lord, Lord Bethell, to the attention of my right honourable friend who, I hope, will be taking this Bill through another place later this week. I will also draw his attention to the points that have been made. I am not putting forward any real hope, but I will certainly see that my right honourable friend is made aware of the case which has been put and I will leave it with him for his personal consideration.
My Lords, I am most grateful to the noble Lord, Lord Shepherd, for the careful consideration which I know he and his advisers have given to my Amendment, and also for what the noble Lord has said this afternoon. There is one point which I should first like to emphasise in regard to the dangerous situation that I outlined in my speech, whereby landlords arc withdrawing their flats from the furnished private market. It has already begun. I have discussed this with certain agents who specialise in this type of accommodation, and I am assured that some landlords are keeping their flats empty because of this Bill and are awaiting events. If some way cannot be found of reaching a solution, such accommodation will vanish from the private furnished market. I can only hope that the noble Lord, Lord Shepherd, will be able to discuss this matter with his colleagues and his right honourable friend and that perhaps some way might be found of keeping the main purpose of the Bill without doing the damage that I believe would be caused if some Amendment similar to my own is not introduced. With that hope, I beg leave to withdraw the Amendment.
§ LORD SHEPHERD moved Amendment No. 3: Page 2, line 2, after ("above") insert (", subsection (4)(a) below").
§ The noble Lord said: My Lords, this is a drafting Amendment. Tenancies are brought into the protection of the Bill by virtue of the Amendment to Section 2(1)(b) of the Rent Act, contained in subsection (4)(a) of Clause 1, a well as by 77 virtue of subsection (1) of that clause, and it effectively repeals Schedule 4 of the Bill. I beg to move.
entry on the roll kept under section 2 of the Midwives Act 1951, registration under section 7 of the Medical Act 1956, admission to the register or roll maintained under section I of the Nurses Act 1957, registration under section 2 of the Dentists Act 1957, registration under section 2 of the Opticians Act 1958, registration on any register maintained under section 2 of the Professions Supplementary to Medicines Act 1960, registration under section 2 of the Veterinary Surgeons Act 1966, admission under section 1 of the Solicitors Act 1974, qualification to practice any other specified trade or profession").
§ The noble Baroness said: My Lords, I beg to move Amendment No. 4 and at the same time to speak to Amendment 5. I should like to begin by thanking the noble Lord, Lord Shepherd, for the meeting we had and our full discussion on this problem, and also for the thought he has given to this matter. We all recognise there is a real problem for universities and polytechnics, and for students and young people generally as a result of the Bill, and in particular, Clause 1. I do not wish to repeat all the arguments that were fully explained at Committee stage, except to say that we on this side of the House consider that Clause 2, as now drafted, is unsatisfactory.
§ It may be helpful to explain the main point at issue. Clause 2 is concerned with exemptions from Clause 1, regarding full security of tenure to furnished tenants, and Clause 2(1)(bb) refers to students. Most students living in colleges, halls of residence, or flats owned by the university or polytechnic, will almost certainly be exempted from the provisions of Clause 1 because they are not tenants but live there on licence. The university or college therefore can get back the rooms when a student has completed his course and use the accommodation for another student. Students living in the old-fashioned "digs" with a resident landlady are exempted because under the Bill there is no security of tenure in furnished accommodation where the landlord is resident. As I understand it, this exemption under subsection (1)(bb) was inserted because there are few cases of students who are actually tenants of universities and would, therefore, have protection under Clause 1 but for this exemption.
§ Therefore, the university might not get back the accommodation it provides when a student has finished his course, and which it needs for future students coming in. This principle is important, because it means that the Government recognise there is a problem for universities and polytechnics if students do not leave their accommodation when they have finished their courses and make room for somebody else. What we on this side of the House are seeking to do by this Amendment is to widen this exemption, because thousands of students now live in furnished flats and will have complete security of tenure under Clause 1. As a result, there will undoubtedly be fewer flats to let, and for future generations of students very little accommodation of the type that students prefer—that is, to be independent of the university and what they regard as a paternalistic attitude. Secondly, in this Amendment we have sought to widen the exemptions to include other young people, including those doing courses under industrial training legislation and those taking medical courses of one kind and another.
§ Under Amendment No. 4 there is still provision for the Secretary of State to specify other institutions that might be exempted if he so wishes, and the House will realise that we have amended the original Amendment at the bottom of 79 paragraph (iii) to include qualification to practise any other specified trade or profession and therefore to widen it. I have re-read what the noble Lord, Lord Shepherd, said at the Committee stage and, as a result, we have further redrafted this Amendment to meet the criticisms.
§ Before going into detail, I would make one general point because there is one criticism that the Amendment does not meet. The noble Lord, Lord Shepherd, said that if the Government agreed to the Amendment, students would be discriminated against because they would not have the full protection of the Rent Bill. My answer to that is that under this Amendment students will be no worse off than they are now, because they will still have all the protection that Part VI of the Rent Act 1968 affords. It is true that they will not have the added protection of the Rent Bill, but, as I indicated on Second Reading, it is arguable how much better off collectively they will be; those in accommodation will be protected, those seeking accommodation will encounter difficulties in finding it. If this Amendment were agreed to, it could well be argued that students would find themselves the only people able to get furnished accommodation. So it is equally arguable that they would be better off.
§ I turn now to the Amendment and to the next criticism which was made, which was that it would be very difficult to identify who was a bona fide student. The new subsection (4) in Amendment No. 5 is designed to meet this criticism—that is, it would be difficult to know or prove in court, if necessary, who is or is not a student. The first part of subsection (4) says that in order for a person to prove that he is a student he must be able to show that he has entered a particular course. I understand that the term "entered for a course" is the generic term for starting any of those courses, particularly in the medical profession. Alternatively, he must show that he is engaged in a service contract. However, if the case should come to court, the burden of proof would be on the person who claims that he is not a student and is therefore entitled to security of tenure because the landlord would have let the rooms on the assumption 80 that he was a student and therefore he would leave at the end of his time.
§ The presumption in law, therefore, is that the person in question is a student. I understand that presumptions like this are not uncommon in law, and are used extensively in the law on food and drugs. If a housewife complains to the public health inspector that there is a mouse in a loaf of bread the presumption is that it is the responsibility of the bakery to show that they did not put the mouse in it, otherwise it would be extraordinarily difficult to prove who did so. The same principle applies in the new subsection (4) and it meets the criticism of determining who is or is not a student. The noble Lord, Lord Shepherd, also said that the Government have not found time to undertake all the necessary consultations, either with the Department of Education and Science or the local authorities.
§ Leaving aside the whole principle of whether or not it is right to introduce important legislation without undertaking these consultative procedures at all, subsection (5) is meant to help the Government out of this difficulty. It enables the Secretary of State to make regulations either adding to the list of exemptions, or making any other detailed Amendments which may well become necessary after these consultations have taken place, including the wording of subsection (4). It therefore enables the Government to carry out their consultations, but the result must be taken against the background of the first part of the Amendment which would stand as part of the Bill.
§ In moving this Amendment, I hope therefore that the Government will accept that we are trying to be helpful. This Amendment also has been drafted by my noble friend Lord Colville of Culross, and I believe it meets not only the anomalies which we all recognise exist in Clause 2, as now drafted, but also the criticisms made of the original Amendment at Committee stage. I hope that as we on this side of the House believe this to be an important Amendment, the Government will feel able to accept it. I beg to move.
My Lords, if we are to have a debate, it may be helpful if I intervene now. The noble Baroness 81 referred to our meeting, and I am grateful that she was willing to attend. I think she will accept—and I certainly give an assurance to the House—that we have a great deal of sympathy with the intention of this Amendment. I could be critical as to its drafting, even though it was done by the noble Viscount, Lord Colville of Culross. I could also be critical that it raises a new concept in rent legislation, because previously rent legislation dealt with the property and not with the profession or occupation of the occupier. I could do that and take some time on it; but I should like to make a short intervention to state what the Government's intentions are in this matter. This is an area of great complexity and I personally do not think that it is possible to legislate within the short period that we have to deal with this Bill. But perhaps the House will feel that I have gone most of the way to meet the case being made.
The Government are, as I have said, fully alive to the possibility that the supply of private lettings to genuine students may be at risk, and are anxious to secure the continuance of an adequate supply. Consideration of this problem suggests that the best way of tackling this might be by the introduction of a system for the registration of private lettings approved by specified educational institutions for occupation by students, whereby registered lettings should be excluded from full Rent Act protection. Such a system would well be established by regulation. But the regulation-making provisions that would be needed to establish such a system could not possibly be devised in a few weeks. This is a matter that greatly concerns public bodies outside the Government.
The framework of a registration system would have to be the subject of consultation with representatives of educational institutions, with institutions providing courses of vocational training, and with the local authority associations. All would be closely concerned with the implications of such a system, and with such matters as the criteria for approval, the method of approval and registration and provisions for review of registrations and deregistration. Until they have been consulted it would be impossible for the Government to lay before Parliament measures enabling such a system to be set 82 up. The Government therefore intend to launch these consultations as soon as possible after the passing of the Bill, and hope when they are complete to be able to lay before Parliament legislative proposals enabling a registration system to be established.
I hope, therefore, in view of this assurance that the Government will be tackling urgently the need to ensure a supply of private letting for students, and will be doing so by a means designed to exclude the serious weaknesses and dangers of the method which is embodied in the Amendment of the noble Baroness, that she will feel that I have gone pretty well all the way—not entirely, but nearly all the way—to meet her point. We sympathise with the need for some provision to be made in this area. We do not believe that we can include it in this Bill, but it is our intention to enter into immediate consultation with all the institutions and authorities involved, and then to produce the scheme in legislative form.
My Lords, before the noble Lord sits down may I ask him a question arising out of his speech? At one stage he said that this matter could be dealt with by regulations, but further on he said it would require legislation. Which is correct?
My Lords, it could be done by regulation, but before one can put down a regulation one needs to have consultation. The advice I have is that if we are going to embark upon a scheme of this kind, and if we are to ensure that it works satisfactorily both for the students and for the general community, including the local authorities who have a particular interest, we should have wide and careful consultation and then introduce the necessary machinery by legislation.
My Lords, can my noble friend the Leader of the House assure us that the Government will act rapidly in this matter? As he must be aware, the problem becomes serious about September. In almost all higher educatíonal institutions one finds that it is round about September that pressure for accommodation builds up. There are involved the polytechnics, technical colleges, universities. The problem—I can speak for the City of Newcastle—is 83 very grave indeed, although the local authority has done its best in the matter. If the noble Lord could reassure us that the Government are prepared to act quickly in the matter, I personally would be very happy and satisfied.
My Lords, it is undeniable that some anxiety has been felt by landlords in the university towns that students would stay on after expiry of the residential contract, although, as I explained when we were discussing this matter previously, I felt the fears were considerably exaggerated. By the very nature of a student's life, it comes to an end when he has completed his degree or further degree, as the case may be. It is extremely unlikely that in those instances he is going to take employment in the town where he happens to have been educated with the U.C.C.A. system. Larger and larger numbers of young people are going to universities miles away from their home towns, and in nearly all cases they will seek employment nearer to the place they know from their childhood. I can, however, see the force in what the noble Lord has said in so far as it is necessary to be sure that the landlords will continue to allow their property to be used for these purposes.
The only qualification is that if it is discovered during the process of consultations which the noble Lord has mentioned that there are no cases of students overstaying their welcome after the expiry of a contract, then surely this fact could be drawn to the attention of those who represent the landlords in the discussions and they may feel that the complicated and burdensome system of registration, as no doubt it will be, could be dispensed with and that the protection of students leaving voluntarily at the end is all that would be required. The method that the noble Lord has chosen to deal with the problem is vastly preferable to that advanced by the noble Baroness, in spite of the fact that, as she told us, her Amendment was drafted by no less an expert than the noble Viscount, Lord Colville of Culross. One serious defect in the wording of her clause which should be drawn to the attention of your Lordships is that it would apply to all tenants who are students of the kinds described here. Perhaps somebody who is already 84 a tenant of a private landlord takes up a course of education. It may be a mature student—a lady who upon reaching the age of 35 or so decides she can go back to university, her children being old enough to cope on their own. She can suddenly be taken out of the protection provided by the Bill. I am sure that that cannot be what the noble Baroness, Lady Young, intended. So even if the noble Baroness is not completely satisfied with the solution posed by the Government, I hope she will not press her own Amendment to a Division.
My Lords, before the noble Baroness replies, may I say that I would agree with the noble Lord, Lord Avebury. That is one of the consequences of the Amendment; but in reply to the noble Baroness I did not want to spend too long in dealing with the defective part of the Amendment and some of the consequences. But I should like, since this is a matter of interest, to reply to the point my noble friend Lord Wynne-Jones has put to me. Clearly I cannot commit a future Parliament, but what I can say is that when the adequate framework for a registration system has been worked out it would be our intention to take the first opportunity of introducing enabling legislation.
My Lords, I am very satisfied with the assurance my noble friend Lord Shepherd has given. I realise full well the great difficulty of this problem. I have been for 10 years or more treasurer of a university—that was up until last year—and I realise the great difficulties which universities have in obtaining lodgings for their students. They are inhibited to a great degree from building their own accommodation, although in the case of the university with which I have been associated a great deal of accommodation has been built. One has to bear in mind that this is not a problem of static proportions. A certain number of students, having finished their third year, will go out this July; a corresponding number will come in and take over a corresponding number of lodgings. But another factor has to be borne in mind. The numbers of students in many of the universities are growing. A number of lodgings will be vacated this summer and reoccupied by 85 students in September, but that will still leave all the additional students to be catered for.
I suppose that other towns in which universities are situated have had the same problem. We seem to have skimmed the barrel dry of available lodgings in the particular towns concerned. We may make Amendments as the noble Baroness has suggested—and I welcome those Amendments—but at the same time we cannot get a quart out of a pint pot, and if the lodgings are not available, and the potential landladies are not willing to come forward, it is going to be a very difficult problem indeed. I am wondering whether—it is irrelevant to this Bill—local authorities in university towns could be encouraged to build blocks of flats which would be available for students. It may be said: "Why do not the universities themselves do so?" My particular university has built them in considerable numbers. But I feel that something over and above the available lodgings in private houses must be provided for students in these growing universities.
My Lords, I should like briefly to support my noble friend. It seems clear that the issue between my noble friend and the noble Lord the Leader of the House is a fairly small one. It is whether or not one writes this provision into the Bill now or deals with it by regulation later. I was very struck by what the noble Lord the Leader of the House has just said about committing the Government on the undertaking he has just given to the Committee. However, one has to recognise that there is uncertainty about the length of this Parliament. Therefore I feel that no harm can be done by writing this Amendment into the Bill, even if another place amends the precise wording.
My Lords, I should like to thank the noble Lord, Lord Shepherd, for the careful thought and consideration that he has given to this matter. I appreciate that lie has done everything in his power to try to meet the point that we both agree is not settled by Clause 2 of this Bill. He has made the offer to look into this question as a matter of urgency and to bring in regulations and, later on, legislation to deal with it. However, as both the 86 noble Lord, Lord Wynne-Jones, and the noble Lord, Lord Leatherland, have said, this is an urgent matter. We have already heard that flats which were available are not going to be available quite soon. Once the Bill is on the Statute Book this will happen even more quickly. I do not know in detail what timetable the noble Lord, Lord Shepherd, has in mind; but given that he starts the consultations while this Bill is going through another place, he knows, as I do, that most local authorities will be in recess in August. Therefore it will be difficult to take decisions then. Also, many universities will be in the depths of the long vacation and the problem will be upon them in September or October. It is unlikely that they will have come to any conclusions by then, because this will require careful and detailed consultation with all the universities and polytechnics and with all districts as housing authorities—or, at any rate, with all those districts which include within their boundaries universities, polytechnics and other educational establishments of one kind or another.
The noble Lord, Lord Avebury, has said that I have exaggerated the problem. I should like to think that that was so. I have tried very hard to find figures. The only other university for which I have been able to find figures is Leeds University where it is estimated that about 4,500 students live in flats of this kind. The noble Lord, Lord Avebury, says that almost all of them will leave at the end of three years. I wonder whether that is so. I doubt very much whether that is so in London, since many students find employment in London; and I doubt whether that is so in Birmingham, since again many students find employment in Birmingham. Also I doubt whether that is so in the case of polytechnics, where students could be doing sandwich courses, and in the case of medical students who would stay where they are. In these particular cases it is not an exaggeration to say that a large proportion, given security, could well stay on for much longer. Indeed, T believe that the Government think that is so, otherwise they would not have put Clause 2(1)(bb) into this Bill; they know that these educational establishments need a constant re-use of accommodation in order to find places for the constant inflow of students. Furthermore, it leaves out all 87 the other students whom my Amendment covers. We need to look much further than simply at the universities and the polytechnics. There are a great many other young people who will need accommodation.
I hope I have said enough to show that I have considered this matter very carefully indeed. Having listened to what the noble Lord, Lord Shepherd, has said, I feel that I cannot accept it and that I must press my Amendment.
My Lords, the noble Baroness mentioned Leeds and 4,500 places, and I was not quite sure what she meant by that. Is she aware that the local authority in Leeds proposes to make available to students fiats in the big Quarry Hill complex which will be closed for normal housing?
My Lords, I had heard that the local authority was going to make some flats available and I was glad to hear it. I had my figures from a responsible person at the university. However, as the noble Baroness, Lady Bacon, was not here at Committee stage, she may not have appreciated which group of students we are talking about. We are not talking about those students who are living in halls of residence or in colleges. We are talking about students who choose to live in private flats as tenants. That was the number which I was given of students who were thought to be living in private flats in Leeds. This figure could include other educational institutions besides the university. However, in round figures that was the information which I was given.
My Lords, I am not disagreeing with the figures which the noble Baroness, Lady Young, has given. I am only saying that there will be this extra accommodation, since the big Quarry Hill complex will no longer be used for local authority family housing. Many of the flats there will be made available for students who would normally be in private accommodation.
My Lords, before the noble Baroness, Lady Young, sits down, can she say whether she has taken into consideration the point which I made about tenants who will be protected at the time the Bill goes through but who, by subsequently taking a course of education, 88 will be removed from protection by her Amendment? Does the noble Baroness think that this is the way to encourage mature students to go back to university?
My Lords, I accept that the noble Lord, Lord Avebury, may have identified one hard case. However, I should not like to agree with him that all mature students will be in that particular position. After all, a great many mature students are married women who decide to take a further degree either at the Open University or somewhere else. Therefore they will be living in their own homes and will not necessarily be tenants of furnished accommodation. The only people who would be affected by the particular case which the noble Lord gives are those mature students who happen still to be in furnished accommodation.
My Lords, would the noble Baroness not agree that if she had a son who was working but who, at the age of 25, decided to take a course and become a student, he would lose all the protection that he previously had? That would be a consequence of the Amendment of the noble Baroness.
My Lords, before the noble Baroness replies again, would she not accept that it is not just a question of furnished tenancies to which her Amendment refers but any tenancy granted to any student?
My Lords, I am particularly concerned with furnished tenancies because I think that it is exceedingly unlikely that many students will be in unfurnished accommodation. The noble Lord, Lord Gifford, may know of students who are rich enough to furnish an unfurnished fiat. However, most of the students whom I know are living on grants in furnished accommodation and certainly could not equip themselves in unfurnished accommodation. They are living in simple accommodation. However, I accept that some students might be living in unfurnished accommodation. If the Amendment extended relief to unfurnished accommodation I would regard this as no bad thing—as, indeed, I welcomed at Second Reading the extension by the Government in this Bill of freedom to unfurnished accommodation where the property has a resident landlord.
§ to speak, with the leave of the House, and that the mover of the Amendment can move it and wind up. My Lords, I bring myself to order and suggest that everybody follows suit.
Aberdare, L. Gisborough, L. Nugent of Guildford, L.
Amherst of Hackney, L. Goschen, V. Rankeillour, L.
Amory, V. Gowrie, E. Ruthven of Freeland, Ly.
Belhaven and Stenton, L. Hailes, L. St. Helens, L.
Belstead, L. Hailsham of Saint Marylebone, L. Sandford, L.
Bethell, L. Hawke, L. Sempill, Ly.
Colville of Culross, L. Hunt of Fawley, L. Somers, L.
Cowley, E. Killearn, L. Strange, L.
Cullen of Ashbourne, L. Kinnoull, E. Swinton, E.
Denham, L. [Teller.] Long, V. Tenby, V.
Derwent, L. Luke, L. Tweedsmuir, L.
Drumalbyn, L. Masham of Ilton, B. Vivian, L.
Elles, B. Mersey, V. Waldegrave, E.
Elton, L. Monck, V. Windlesham, L.
Exeter, M. Mowbray and Stourton, L. Yarborough, E.
Fortescue, E. Northchurch, B. Young, B.
Arwyn, L. Garnsworthy, L. Peddie, L.
Avebury, L. Gifford, L. Raglan, L.
Bacon, B. Goronwy-Roberts, L. St. Davids, V.
Birk, B. Greenwood of Rossendale, L. Segal, L.
Blyton, L. Harris of Greenwich, L. Shannon, E.
Castle, L. Jacques, L. Slater, L.
Crook, L. Leatherland, L. Snow, L.
Darwen, L. Llewelyn-Davies of Hastoe, B. Stow Hill, L.
Donaldson of Kingsbridge, L. Melchett, L. Wells-Pestell, L.
Elwyn-Jones, L. (L. Chancellor.) Milner of Leeds, L. [Teller.] Wynne-Jones, L.
§ The noble Baroness said: My Lords, I beg to move Amendment No. 6. A similar Amendment to this—moved by my noble friend Lord Kinnoull—was discussed at the Committee stage of the Bill. We all agreed—and I am sure the noble Lord, Lord Shepherd, has much sympathy—with the case of a person who buys his house for retirement. This might apply to a Minister of Religion, a schoolmaster, or someone living in tied accommodation who buys a house for retirement, lets it until he is ready to retire and then expects the tenants to leave so that he can go to live in it himself. Or there is the alternative case of, perhaps a man who lives in London but who has always wished to retire to the Yorkshire Dales; he buys a cottage which he then lets and wishes to have once he retires from his business.
§ On reading what the noble Lord, Lord Shepherd, said during the Committee stage, as I understand it, the difficulty was that if he had accepted the Amendment moved by my noble friend Lord Kinnoull he considered that it might well open the flood gates to many people who would try to get round the provisions of the Rent Bill by buying houses for their retirement which were not intended for that purpose. Therefore, we have looked at the Amendment again and have redrafted it in order to meet this criticism. In the present Amendment the burden of proof will be on the person to show that he bought his house for retirement. Given that he can show this, under Schedule 3 to the 1968 Act he would fall within those cases in which the court must order possession rather than leave the position as it stands (as the noble Lord, Lord Shepherd, described it) for him to argue his case 92 under Case 8, which is a case in which the court may order possession. The difficulty now will be that the court will consider the case with a background of the security of tenure which the Rent Bill affords. I do not think it is good enough to leave the position like this. On this side of the House we are concerned only with bona fide cases of people who, either because of the nature of their work, or because they have always wished to retire to some part of the country, have bought a house in which they wish to live themselves. Therefore, I hope that the Government will feel able to accept this Amendment; that it does meet the criticism which the noble Lord, Lord Shepherd, raised on Committee, and that he will feel that these deserving people ought to have the assurance that when they wish to retire they will be able to occupy their own house without any difficulty at all. I beg to move.
My Lords, I have sympathy with this Amendment, as I did with the last one. But in view of the giants opposite who flexed their muscles on the previous Amendment, I wonder whether I should be equally conciliatory to this Amendment. Perhaps I was remiss on the last Amendment in that I did not seek to expose its weaknesses and dangers. The noble Lord, Lord Avebury, mentioned one of these. I did it deliberately, because I was hoping that one could reduce the time spent on Report stage, and hoping also to put forward what I thought was the right approach for dealing with a very complex matter. But in the light of the fact that the House clearly wants full explanations on Amendments moved, I fear I may have to speak at some length on this Amendment.
As the noble Baroness, Lady Young, said, this Amendment is a revision of one the noble Earl, Lord Kinnoull, intended to move, but which the noble Baroness moved in his absence. After an intervention on my part, the noble Baroness withdrew the Amendment. Case 10 of Schedule 3 to the Rent Act is the Case that enables an owner-occupier to regain possession of a dwelling he formerly occupied as his residence, and then let. It is one of the "absolute possession" cases; that is, a case in which a court, if satisfied that certain 93 conditions exist, must make an order for possession. One of these conditions, common to all absolute possession cases, is that the tenant must be given notice not later than the start of the tenancy that the landlord reserves the right to regain possession under the Case. The other conditions are that the landlord formerly occupied the dwelling as his residence; that he has never let the dwelling since December 8, 1965, on a protected tenancy not subject to Case 10; that the dwelling is needed for his occupation, or for a member of his family who lived there with him when he lived there before.
This Amendment is designed to extend Case 10 to cover the situation in which the landlord has never lived in the dwelling, but intends to do so on retirement. It is defective for its purpose. For instance, to refer to the first line of Case 10, to the intended retirement home which the landlord has never occupied, if I may say so makes a nonsense of the final Case 10 condition which refers to members of the landlord's family who lived there with him. More seriously, it would leave the case as open as would the previous Amendment to allowing evasions of the Act.
My Lords, intentions are easily expressed, and "retirement" is an undefined term. It should also be remembered that the person who has let the dwelling which he wishes to occupy when he does retire, already has a right to seek possession under Case 8 of Schedule 3, as has any landlord who needs for his own occupation or that of the owner's relatives, the dwelling he has let. This Case certainly does not give an absolute right of possession, which will be granted only if the court considers it reasonable and is satisfied that making the order will not cause the tenant more hardship than not making it would cause the landlord. None the less, it gives the landlord a good prospect of repossessing the dwelling in which he hopes to live.
During the Committee stage of the Bill, I was asked whether any difficulties had been drawn to the attention of the Department. No such cases have been. I admit that this proves nothing in itself, but it may be accepted, perhaps, that in the circumstances we have no grounds to suppose that people who in good faith let unfurnished dwellings in which they 94 hope to live on retirement, have had difficulty in repossessing those dwellings when needed. Nevertheless, the Government recognise that the lack of certainty that a retirement home will be available when needed can be distressing.
The problem is one of giving an absolute right of repossession of the true retirement home without at the same time opening a door for potential evaders of the Act who would seek to use such a right to deny tenancies in dwellings they themselves do not really mean to occupy as their own ultimate home. The Government intend to examine this problem in the hope of finding some way of reconciling the need of a landlord for assurance that he will be able to live in his true retirement home, with the tenant's need for security, in any dwelling that will not be genuinely so needed. These requirements are not easy to reconcile. I will be frank with the noble Baroness. I have spent a considerable time in seeking a way round this. We will proceed with our inquiries. Although I cannot undertake that there is an immediate solution which we can incorporate in this Bill, despite what happened on my earlier offer to help I can say I will continue in my endeavour to find a way of meeting this point, with which we have a good deal of sympathy, between now and consideration in the Commons.
My Lords, I thought these individuals were dealt with in Committee stage. These people are in fact covered in the Bill. It seems to me that in this Amendment we are considering those who have retirement homes.
My Lords, I must apologise if I misread my brief. 95 I wish to support my noble friend Lady Young in whatever action she wishes to take in view of what has been said by the Leader of the House.
My Lords, I have listened with great care to what the noble Lord, Lord Shepherd, has said, and I should like to say immediately how much I appreciate the offer to look at this matter before the Bill goes to another place. The difficulty that I find myself in is that I accept that the drafting may not be perfect. I drafted it or, more accurately, my noble friend Lord Colville drafted it, with the intention of meeting the point of criticism that people would seek to evade the provisions of the Bill by using this Amendment. I thought we had met this difficulty, and I should like to give an assurance that we are not seeking a loophole in this Bill, but are simply trying to put right what I think is a very real fear among a number of people. I am bound to say that I am surprised that the term "retirement" is not defined in law. Not being a lawyer, I am sure that this advice is right, but I should have thought that in all the legislation governing pensions and social security it would have been defined.
The difficulty about the proposition that we should leave this to the Case 8 situation is that there can be no guarantee that a person would get his house back, because Case 8 of Schedule 3 covers cases in which the court may order possession and the court will clearly consider the situation in the light of the background of this Bill. Therefore, the situation will have been altered from what it was. As I think the noble Lord said, even if there are no cases on record where the owner has been dissatisfied, that does not prove that there will not be cases in the future or, indeed, that there are no dissatisfied people; it merely means that they have not complained. I feel that I am speaking on behalf of a number of people now coming up to retirement age who, undoubtedly, have bought houses to which they expect to retire and into which they expect to be able to move when they reach the age of 65. I should have thought that if somebody bought a house at the age of, say, 25 and said, "I am buying it for retirement", the court would realise that that was an absurd situation. But if 96 somebody buys one at the age of 55 or 60 it is a very different proposition, and I should therefore have thought that the wording of this Amendment would allow for the evasions.
Because I have had a great many representations made to me on this point, I feel that, despite all the assurances, I cannot withdraw the Amendment. I hope the noble Lord, Lord Shepherd, will realise that I am very grateful for his offer, and that he will accept that he can put this matter right in another place and thus give to a great many people, who are at present very worried, this security which I think is rightly theirs.
§ The noble Lord said: My Lords, on behalf of my noble friend, I beg to move Amendment No. 7. The Amendment defines what is meant by the expression "a tenancy for a specified period not exceeding 8 months" in Case 11A which is inserted into Schedule 3 to the Rent (Scotland) Act 1971 by Clause 3(2). This case applies to Scotland only. The purpose of Case 11A is to enable a landlord to recover possession of a holiday dwelling house where he has let it for a specified period not exceeding eight months on an out of season let. At present, Case 11A provides what should be treated as being a tenancy for a specified period for the purpose of this case, but it is considered that in Scotland the difficulty which may arise is not as to what is meant by "a tenancy for a specified period", but as to what is meant by, "a tenancy for a specified period not exceeding 8 months". The Amendment proposes to define what is meant by, "a tenancy not exceeding 8 months" in terms similar to the way in which, "a 97 lease for a period less than 7 years" is defined in Section 9(1) of the Housing (Scotland) Act 1966. I beg to move.
My Lords, I beg to move Amendment No. 8, and with your Lordships' permission will speak to Amendment No. 9. These are drafting Amendments to the provisions about the determination of a suspended notice to quit relating to a furnished tenancy which becomes protected on the commencement date by virtue of Clause 1 of the Bill. The order of the paragraphs is changed and the existing paragraph (d) is re-written in different terms in the interests of clarity. There is no change of substance. I beg to move.
My Lords, I beg to move Amendment No. 10 and will also speak to No. 11. Both of these are drafting Amendments. Part VI of the Rent Act re-enacts the Furnished Houses (Rent Control) Act 1946 and uses the expressions "lessor" and "lessee". The Rent Act is drafted in terms of "landlord" and "tenant". This Amendment to the new Section 74(2A) of the Rent Act brings the terminology into line with that used in the rest of Part VI. I beg to move.
§ LORD GIFFORD moved Amendment No. 11A: Page 10, line 16, leave out from ("operation") to ("the") in line 17 and insert ("on the day after").
§ The noble Lord said: My Lords, out of the great number of Amendments which my noble friend Lord Melchett and I moved on Committee, this is the only one we have retained for consideration this afternoon. The object of the Amendment is very clear. The Bill at present will come into force one month after the day on which it is passed. My Amendment is designed to reduce that period of one month to one day. So far as the other Amendments which my noble friend and I moved on Committee are concerned how grateful I am to my noble friend Lord Shepherd for the very serious attention he gave to them. In some cases the Amendments to be moved this evening take those Amendments into account. In other cases certain letters have been written and assurances given, and I am very happy to say that, although not entirely content, I certainly do not want to press the points further. However, on this Amendment, the date of coming into force of the Act, I am bound to say that on reading what my noble friend had to say on Committee I find myself most dissatisfied by the reasoning which he gave for not bringing this Bill into force immediately after it is passed.
§ One of the reasons he gave was that there had in any case been enough time to protect tenants who were given notice to quit on the coming into power of this Government. He said if all the procedures had been gone through and the 99 tenant had applied to the rent tribunal, there would not be enough time for the landlord to obtain possession before the Bill came into law. That may be true of people given notice to quit who have the knowledge to go to the rent tribunal, but of course it is not true at all of tenants on fixed term tenancies.
§ As my noble friend knows, a convenient device has been found in the past by many landlords to avoid being subjected to the security of tenure provisions of the rent tribunal by granting fixed term tenancies to their tenants. To give one such example of a trend that I believe is quite widespread at the moment, I am given to understand that a certain gentleman called Lord Elliot—he is not a Member of your Lordships' House but one day may be a Member of your Lordships' House—has a number of properties in London let on fixed term tenancies, some of which have come to an end in recent weeks. He is going straight to the county court for possession on the grounds that it is necessary to get early possession to avoid being caught by the Rent Bill. I have written to Lord Elliot saying that I had this information. I have received no comment, or denial that that indeed is his intention. What is certainly happening during this month is that a number of landlords with tenants on fixed terms are going to the county court for possession. They will get it some time during July, and if there is a month's delay thereafter they will be able to execute those orders for possession during August, before the Bill can possibly become law.
§ My noble friend at Committee stage said that it was customary for a period of delay to be given so that people should get to know the law before it comes into force. I would suggest that that is not the custom, nor indeed is it desirable, with a Bill such as this. The precedent is the Protection from Eviction Act, 1964. Then, as now, tenants were losing their homes, or being threatened with eviction from their homes, because of the coming to power of a Labour Government pledged to give security. Then, as now, there was a need to act quickly; then, as now, there was a point to be made that landlords might not know about the law, and therefore would act unlawfully without being aware of the fact. Parliament then thought it right to bring that Act 100 into force directly after it was passed, and they did so, rightly, because there was a social evil to be prevented. The evil may be less great now, but it is certainly there.
§ Undoubtedly, landlords are becoming more and more familiar with the provisions of this Bill as it passes through Parliament and as it begins to get more and more widely known. That is the reason why it is necessary to have the shortest possible delay before it comes into law. The Government have recognised this by saying all along, and with my full agreement, that we need to get this Bill through quickly. I would wish to see it come into law quickly, and I would urge my noble friend to look again at the reasons why there should he a month's delay. I hope that he can tell me that those reasons, in the context of this Bill, are really not strong enough, and that an earlier date can be arrived at. I beg to move.
My Lords, I should like to rise briefly to support everything that my noble friend Lord Gifford has said, both in regard to the careful consideration that my noble friend has given to all the Amendments we spoke to at Committee stage and in urging this Amendment on my noble friend. I think that it is fair to say we have all agreed that the Bill still contains some omissions, even loopholes, and we are all agreed that, for reasons of speed and necessity, the Bill must become law very quickly. I certainly accept that argument. Inevitably, it follows from that that the Bill must come into effect quickly as well. As my noble friend Lord Gifford has said, there are already cases coming up where landlords are rushing to get possession, in one way or another, to evade the provisions of the Bill. It would be a tragedy if people were evicted from their homes merely to give my noble friend's advisers time to prepare documentation to explain the Bill so that people can understand it. I hope that he will feel able to accept the Amendment moved by my noble friend.
My Lords, I do not know whether the noble Lord, Lord Shepherd, is to reply to this Amendment as he did at Committee stage, but I felt that he then advanced important arguments why this Amendment should not be accepted. Among his arguments, I 101 think that the most important was the need for consultation with local authorities, because clearly this will affect them. Even if it is not considered to be necessary, the noble Lord, Lord Shepherd, gave an undertaking, which I think was accepted by all parts of the Committee, that in this very complicated piece of legislation there should be some kind of simple explanatory memorandum, so that many individuals who will be affected will understand how the Bill is to affect them.
I am bound to say that I was slightly shocked by the noble Lord, Lord Melchett, saying that we must rush the Bill through because so many people would understand it that they would do something about it. It may well be that some unscrupulous people will do just that; it certainly will not be for want of warning on this side of the House, because we have consistently said that this is what will happen, that fewer people will let furnished accommodation. Be that as it may, a great many other people, who are not unscrupulous landlords but are performing a useful service in letting furnished accommodation, are entitled to understand the Bill and to have a reasonable explanation of it; quite apart from them, so are local authorities. For those reasons, I hope that the noble Lord, Lord Shepherd, will speak in the same terms as he did at Committee stage.
My Lords, when I hear from the noble Baroness that we need time for consultation, time to consult the various local authorities, when that was the bone, and meat of my argument on an earlier Amendment of considerable importance which the noble Baroness herself rejected, supported by her colleagues (some of whom came from distant parts of the House without having heard the argument), I must say I find it rather hard to accept, and equally if I may say so to my noble friend, his suggestion that my arguments on Committee were not good enough. I recognise that there ought to be a proper period of time before a Bill becomes an Act in order that those who are affected should be aware of its implications. That was, if my noble friend will remember, the basis on which I objected to his Amendment and which I must also do this evening.
102 However, I recognise that, in regard to those who are affected by Schedule 3, there is a considerable case for the Bill being implemented sooner. However, I have been advised that to amend Schedule 3 would be a mammoth undertaking, and I know that Parliamentary counsel are now already well occupied not only on this Bill but on the Housing Bill and other legislation concerned with the Department of the Environment. I am, therefore, very loth, while recognising the case that has been made particularly as it affects Schedule 3, to impose further labours on them.
I have considered how best I could meet the two problems. I would, therefore, ask my noble friend whether he would be willing to withdraw his Amendment, on the proposition that, if lie does, I would immediately, by manuscript Amendment, move an Amendment which would leave out the words "one month" and insert "two weeks". This would mean that there would be a period—I admit somewhat short—between the enactment of the legislation and the bringing into effect of parts of it. I do this because I have already heard through the grapevine that the noble Lord intends to press this Amendment. I hope he has not taken it from the noble Baroness—but I fear that if he wants to press it to a Division, looking around your Lordships' House and realising that the work of the noble Lords opposite has been well done and many have all gone home, we would be without a quorum, in which case I would not be able to get my Bill this afternoon when it is much needed. Therefore, I say to my noble friend that were he willing to withdraw his Amendment I will then move an Amendment to leave out the words "one month" and insert "two weeks".
I am sure that my noble friend is not asserting that proposition purely because he fears the Division but because I think that he recognises that there is a substantial point, in that it would be wrong for Parliament to have passed a Bill which gives protection to people in their homes if during the next month those against whom the legislation is aimed can rush to the bailiffs, take out warrants and get possession Orders which could not be suspended 103 under Schedule 3 until the commencement date has passed. Therefore, there is a need for a shorter period. Having said that, I recognise that I have made progress in just over two weeks and I will not press the matter further. I am grateful to my noble friend for having made that concession. I beg leave to withdraw the Amendment.
My Lords, I beg to move a further manuscript Amendment to Clause 3.
The noble Lord, Lord Shepherd, would hardly expect me to allow this Amendment to pass without comment particularly when we have already discussed it in Committee and on the Amendment moved by the noble Lord, Lord Gifford. It is a convenient way of settling a difference. I think it is the usual trade union management way of splitting the difference and coming out with "half-way". Perhaps it is all part of the social compact with Back-Bench Members of the Government to make everything go smoothly. I think there is a serious point here. All of us who are knowledgeable about housing recognise the hard cases and recognise, as I have done consistently through this Bill, that many people who are in accommodation at present will be helped by having, security of tenure. But there will be injustice to everybody else, particularly those smaller landlords who will find this an exceedingly complicated Bill to under stand. It is easy for the noble Lord, Lord Gifford, if I may say so, to speak so fluently about the Bill. He is, after all, a barrister, but to those of us who have no legal training it is difficult to understand. I believe that many land lords should not do anything now with out having their solicitor by their side. They probably have never thought of employing a solicitor before. Maybe they should have done, but they have not and no doubt the Bill, whatever else it may or may not do, will be very good for the legal profession.
104 I believe the whole House accepted that there was a need for a simplified explanation. I have found myself deluged by inquiries about the Bill, some of which I have been able to answer and about some of which I have been only too glad to find out from some of the experts of the Department of the Environment, for it is dangerous to give a quick answer when one is not sure. For all these reasons I think it is not unreasonable to leave the length of time between the passing of the legislation, the Royal Assent and its coming into force, as originally drafted in the Bill.
I respond to the noble Baroness, Lady Young, in a serious way, because she has dealt in Committee with the question of publicity. I had intended to speak at some length on this matter on Third Reading. The noble Baroness will remember I undertook to do that. This is not a trade union arrangement. I have gone half-way, if I may say so, with my noble friend as I have sought to go half-way with the noble Baroness. By withdrawing his Amendment my noble friend has accepted my overture with the noble Baroness. It is difficult to strike a balance. There is need for quick implementation of the Bill. Equally, as the noble Baroness has said, there is need for a reasonable pause before the enactment takes landlords in line. In the rent legislation, as the noble Baroness will remember, is the 1964 Act which came into force immediately after the Royal Assent. Therefore with this Bill and also with the case which I put in Committee. I sought to go half way to meet the noble Lord, Lord Gifford. I hope the House will now accept the Amendment.
§ On Question, manuscript Amendment agreed to.
§ LORD SHEPHERD moved Amendment No. 12: Page 11, line 35, at end insert ("having regard to the provisions of that Part.").
§ The noble Lord said: This Amendment relates to Case 9, Schedule 3 of the Rent Act as amended by paragraph 4 of Schedule 1 to the Bill. Under Case 9 105 a landlord can apply for a possession order on the ground that his tenant has overcharged a protected or a statutory sub-tenant. Paragraph 4 extends this case to allow a landlord to apply on the ground that his tenant has overcharged a Part VI sub-tenant. But as the Bill is drafted the case could apply if, for example, the tenant charged the subtenant a higher rent than the maximum rent recoverable under the current rent freeze. The Amendment ensures that he may only apply where the tenant has charged the sub-tenant more than the rent registered under Part VI of the Act or Part VII of the Scottish Act. I beg to move.
§ LORD SHEPHERD: Amendment No. 13 is one of the more pleasant Amendments, a drafting Amendment to remove unnecessary words. I beg to move.
§ LORD SHEPHERD moved Amendment No. 14: Page 12, line 36, leave out paragraph 9.
§ The noble Lord said: I beg to move Amendment No. 14 and to speak at the same time to Amendment No. 15. This is a technical Amendment. Section 45 of the 1968 Act provides that a rent officer may issue a certificate of fair rent for a dwelling-house before it is let on a regulated tenancy. Subsection (2) sets out the assumptions to be made about the terms of a future tenancy, unless these are specified in the application. The rent officer must assume that the tenant will be liable for internal decorative repair and that no services or furniture would be provided under the tenancy. It is not necessary to delete the reference to the furniture, as if furniture is to be provided this will be specified as a term of the tenancy in the application for the certificate. I beg to move.
§ LORD SHEPHERD moved Amendment No. 16: Page 14, line 35, leave out ("words "this Act "") and insert ("word" 1965" there shall be inserted the word and" and after the word "1972"").
§ The noble Lord said: My Lords, on behalf of my noble friend Lord Hughes, I beg to move this Amendment which is mainly to allow local authorities to publicise the rights under the Bill, which power is presently available under Section 125(1) of the Rent (Scotland) Act 1971. I beg to move.
§ LORD SHEPHERD moved Amendment No. 17: Page 15, line 25, leave out from ("(1)") to second ("which") in line 26 and insert ("Subject to subsection (5) below, a tenancy of a dwelling-house").
§ The noble Lord said: My Lords, I beg to move Amendment No. 17, which is a paving Amendment to a substantive Amendment, No. 22; and with permission, I should also like to speak to Amendment 19, which is a paving Amendment but which is of substance, and to Amendments 20 and 21, which are again paving Amendments to Amendment No. 22.
§ Amendment No. 19 makes it clear that a landlord cannot claim that the exemption applies to a tenancy which was granted at a time when there was not a resident landlord in the building. The redrafting of this subsection was necessary to ensure that the exemption applies only to a tenancy granted by a resident landlord. The new subsection (2)—that is, Amendment No. 22—imposes the continuing residence obligation on the landlord. Thus the exemption applies only if the landlord was living in the building when the tenancy was created, and only so long as he continues to live there.
§ My Lords, with permission I would now come to Amendment No. 22, which 107 is of substance, and I would ask forgiveness if I speak at some length because this is an extensive redraft of Schedule 2. It introduces four subsections to replace and correct the provisions in the existing subsections (2) and (3), and to make special provisions for certain circumstances in which the resident landlord does not fulfil the residence requirement set out in subsection (1).
§ For the purposes of the exemption it is necessary to make quite clear what the residence requirement on the landlord is. Subsection (7) below, introduced by the Amendment to page 16, line 21, applies the same test to the landlord as is applied to a statutory tenant by Section 3(2) of the Rent Act. But it is necessary to make additional provision to cover those circumstances which can apply to a landlord but which cannot apply to a Section 3(2) statutory tenant, and so are not covered by the application of Section 3(2). A statutory tenant has no interest in land, but a landlord usually has, unless he himself is a statutory tenant; and so there must be arrangements to cover those cases in which the interest in land changes hands and, for one reason or another, there is a period when the person who owns the interest is not resident. But at the same time it is necessary to ensure that these provisions cannot be abused by landlords who attempt to evade the Acts. The Amendment therefore puts a limit on the length of time for which a tenancy remains in Part VI despite the fact that the landlord is not in residence.
§ Subsection (2) deals with the cases of temporary gaps in residence which occur on the transfer of the landlord's interest in the property, either on purchase or death. It provides that these gaps shall be disregarded when considering whether the residence requirement is fulfilled. The first case to be dealt with is where a resident landlord sells his home to another person who intends to be a resident landlord. It is clearly necessary to provide for this case. If no provision is made, a resident landlord who wants to sell his home would evict his tenants before he moves in order to avoid creating a protected tenancy, which might make it difficult to sell the property. Subsection (2)(a) makes it possible for an intending resident landlord to preserve 108 the exemption if, within 14 days of the conveyancing date, he serves written notice on the tenant that he intends to take up residence in the building. This ensures that the tenant is not left in any doubt about his tenancy. But quite clearly there must be some limit to the time before the landlord takes up residence, or this provision could be abused. Subsection 2(b) states that the exemption will apply for only six months, or until the property passes to someone who does not intend to live there, or until the residence qualification in subsection (1)(c) is satisfied, whichever is the earlier. The period of six months is allowed to enable a landlord who, for example, wants building works done before he moves into his new home, or who buys a little in advance of his actual need to move in, to preserve the exemption. However, if he sells within that period to someone else who does not intend to be a resident landlord, the exemption dies on the date on which the property becomes vested in the absentee landlord, and the tenancy becomes protected.
§ The second case, which is dealt with in subsection 2(c), concerns the situation which arises when a resident landlord dies and the property is temporarily vested in personal representatives, trustees or the probate judge while the estate is settled. None of these is likely to be resident in the building, but the eventual beneficiary may well be, or intend to be. Subsection 2(c) therefore allows 12 months for the settling of the estate, during which the exemption will still apply. If, on the settling of the estate, or at the end of 12 months, the landlord's interest is not vested in a person who is resident, the tenancy becomes protected.
§ During these periods of deemed residence the tenant may well be in some doubt about his position. The provisions in the Housing Bill which give tenants the right to know the identity of their landlord on application will be of some assistance. But in order to ensure that no tenant is deprived of his home while there is not in fact a resident landlord on the premises, subsection (4) provides that the county court shall not make an order for possession on the basis that the tenancy is unprotected. Instead, the court will be able to make an order during such a period only if one of the 109 grounds for possession of a protected or statutory tenancy applies.
§ Subsection (3) covers the situation in which the legal interest is never vested in the person who to all intents and[...] is the resident landlord. This is the[...] where the property is vested in[...] on a trust for sale, or in trust for[...] beneficiary who fulfils the residence requirement. In these circumstances they are the resident landlord for the purposes of the exemption.
§ Subsection (5) contains a corrected and amended version of the present subsections (2) and (3) of Section 5A. It provides that the resident landlord exemption shall not apply in either of the following cases. The first case is where the tenancy in question is granted to a person who was previously a protected tenant of[...] dwelling-house in the same building. This not only corrects the previously erroneous subsection (3) but also meets the substantial Amendment to this subsection put down by my noble friend Lord Gifford at Committee stage. The original version related only to a tenancy which was of the same dwelling house, or which included part of the same dwelling house, as the previous tenancy. My noble friend proposed that this should be amended to relate to tenancy of any dwelling-house in the same building, and the Government undertook to consider the point. I have decided that my noble friend Lord Gifford has identified a loophole by which tenants could be deprived of protection by a landlord, and that this loophole should be closed by incorporating my noble friend's Amendment.
§ The second case in which the resident landlord exemption will not apply is where the tenancy in question is a fixed-term contract and immediately before the tenancy was granted the tenant had an earlier tenancy contract of a dwelling house in the same building. This is an amendment of the existing subsection (2) which adopts the principle proposed by my noble friend on the first case and adopted by the Government in subsection (5)(a). It prevents a landlord from depriving a tenant of the protection he would otherwise have by granting him a fixed term tenancy of another dwelling house in the same building.
My Lords, the Amendment which my noble friend has 110 moved has needed a good deal of time to explain because it is so long. But it is a great improvement on the Bill as previously drafted. I certainly acknowledge that and I am grateful for the references which he has made to Amendments which I moved on Committee stage. Two or three of them are taken care of here. The only point I want to ask about is the reference in the new subsection (5) to fixed-term tenancies. In the Bill as originally drafted, the intention was that, where fixed-term tenancies under two years in length were granted, they should be within the resident landlord exemption—the effect, of course, being that the tenant could not go to the rent tribunal when the tenancy came to an end. Tenancies over two years would not be within that exemption. However, that two-year limit does not reappear in the amended version to which my noble friend has just spoken. As I understand it, the effect will he that, whenever a resident landlord grants a tenancy for any term of years—be it for one, two, three, five or more years—when that tenancy comes to an end, the tenant will thereupon be in danger of almost immediate deprivation of his house. So that a family which may have lived for five or ten years in a house where the landlord is a resident landlord will find upon the ending of that period, if the tenancy is not renewed and made a periodic one and the landlord goes to the court, that they have no possibility of any security or any protection—even that afforded by the rent tribunal.
My noble friend, in explaining that fixed-term tenancies were for this purpose to be permitted was, I thought, thinking about short fixed terms where the tenant—maybe for six months or for one or two years—would go into residence knowing that he might have only a comparatively short period of stay in the house, though if there were an extension he would have rent tribunal rights. I am rather disturbed that although tenants who receive fixed term tenancies have the security of that fixed term, they do not even have the right to go to the rent tribunal to get an extension of security of tenure when that fixed term comes to an end. That appears to be a weakness in the clause as it is now drafted. I have a Manuscript Amendment down, but I do not propose to move it because I recognise that it does not meet the problem. But I ask my noble friend if 111 he cannot answer immediately, to consider what I have said, so that the original limit of two years for these fixed term tenancies might be reinstated in another place.
My Lords, in reply to my noble friend, I will first undertake to consider very carefully what he has said. But as he has drawn attention to the fact that we have omitted the significant words, "two years", it is perhaps right for the sake of those who may be looking at the Bill in another place, or those who may be interested in the legislation, for me to give the reason why we have deleted them. On reflection, I felt that this limitation would be too arbitrary and should therefore be omitted from the Bill. In making this decision I had in mind the situation, which I had previously mentioned, of the resident landlord who knows that he will have spare accommodation for a fixed period, but that at the end of that time he will need it back; for example, to provide accommodation for a child who may be returning home after a certain period away. There is no reason to assume that in all such cases the time during which the landlord can let will be two years or less—it might be two and a half or three years. By deleting the words, "two years" we would give a much greater flexibility to the clause. I think that this is an advantage to possible tenants, because we do not wish to put any unnecessary burdens upon landlords which may help to dry up the availability of accommodation. However, I will look carefully at what my noble friend said in the earlier part of his speech and will see that it is conveyed to my right honourable friend who, I hope, will be responsible for the Bill from tomorrow.
My Lords, I wonder whether I may raise a point of clarification. As I understand the Bill, the whole shift in emphasis will be away from the devision between furnished and unfurnished accommodation, towards a distinction between whether or not the landlord is resident. One of the advantages of this system will be that if someone owns a house in which there is considerable spare accommodation he will let it to all the groups of people who need it. Am I to understand from what 112 the noble Lord, Lord Shepherd, has said, that the redrafted Schedule 2 will allow a resident landlord to give fixed term tenancies of a variable length of time, with security for a given length of time, but with the right—should his family circumstances alter—to have the accommodation back at the end of that length of time? If my understanding is correct, this seems to be a distinct improvement to the Bill, because it gives flexibility and will do what I feel to be very important; that is, encourage people who have large under-occupied houses to let them.
That is my understanding, provided of course that it is for only one fixed term tenancy. It cannot be repeated for the same tenant.
§ LORD SHEPHERD moved Amendment No. 18: Page 15, line 30, after ("building") insert ("and that bulding is not a purpose-built block of flats").
§ The noble Lord said: My Lords, I should like also to speak to Amendment No. 23. Amendment No. 18 limits the resident landlord exemption so as to prevent it from applying to tenancies of purpose-built blocks of flats. This term is defined in new subsection (6) of Section 5A which is introduced by Amendment No. 23. In the original version, the tenancy of a dwelling house in a block of flats would not have been protected if the owner of the block occupied another dwelling house in that block as his residence. This would have presented a possibility for exploitation by commercial landlords who could have claimed the benefit of exemption by investing the ownership of a block of flats in an individual director. It was therefore decided to prevent such misuse of the provision by specifically excluding blocks of flats from the term "building".
§ The word "building" is preferred to "house" which, in Rent Act terms, may include a flat in a block of flats. "House" is not defined in rent legislation although it is used in the Acts. It is subject to interpretation in the light of a vast body of existing case law, most of which concerns the Housing Act. The word "building" would of course cover such structures as converted stables or 113 warehouses, renovated priories, barns, and so on, if these contained dwelling houses.
§ The Amendment to some extent meets the points made at Committee stage by the noble Lord, Lord Gifford, and by the noble Lord, Lord Avebury, about the width of the resident landlord's exemption, because it provides a new restriction of scope and my noble friend tabled an Amendment to restrict the scope to buildings in which there were no more than two tenanted dwelling houses in addition to the dwelling house occupied by the resident landlord. This Amendment goes some way towards doing this by virtue of the definition of a purpose-built block of flats in subsection (6), but it is not desirable to limit the scope of the exemption further by defining the structure so specifically that it does not cover all possible circumstances. For example, a house, as commonly understood, which has been divided into flats may be capable of conversion back into a single unit of accommodation for use by the landlord and his family. With that explanation, I hope that the House will accept the Amendment. My Lords, I beg to move.
§ LORD GIFFORD moved as an Amendment to Amendment No. 18A: Page 15, line 30, in the words proposed to be inserted, leave out ("purpose-built").
§ The noble Lord said: My Lords, I beg to move an Amendment to my noble friend's Amendment and that is to leave out the words "purpose-built". I speak also to the other Manuscript Amendments Nos. 23A, 23B and 23C on the list which has been duplicated. The effect of those other Amendments would be to define a block of flats in this way: that a building would be a block of flats provided it contains three or more flats.
§ My Lords, I recognise that my noble friend's Amendment goes a little way towards meeting the objections that both I and the noble Lord, Lord Avebury, were making to the wide resident landlord exemption in the Bill as it was printed. But I feel that it does not go very far. The problem will be with the larger London terraced houses with which both the noble Lord, Lord Avebury, and myself have experience. One would have to go back into the history of the late 1890s to discover how these were constructed. One 114 can imagine difficult researches having to be instituted to discover, in the kind of large house of which I once occupied a part, whether or not the butler had a separate flat in the basement.
§ As my noble friend's Amendment is at present drafted it gives rise to this kind of consideration and it will be difficult to draw the line. Of course, I understand that what I would expect and what I am sure my noble friend suspects is that most of these large terraced houses were originally built in the late Victorian age for single occupancy by the growing bourgeoisie who needed spacious accommodation in which to live. But it is nevertheless rather absurd. However, my noble friend's Amendment recognises the point that I have been making all along, that where the building was all along designed to be separately occupied by different households there is no case for retaining a resident landlord exemption. There is no difference in principle between a purpose built block of flats and a purpose converted block of flats. There are many of these Victorian terraces, which are now converted into half a dozen, or sometimes a dozen flats or flatlets, where the same reasoning which has prompted this Amendment equally applies.
§ My Lords, I recognise that the Amendment that I put forward to my noble friend's Amendment is using his formula to reinstate something very similar to the words of the Amendment by the noble Lord, Lord Avebury, on Committee. Because it does that and because I know that it will meet with criticism from my noble friend and certainly with opposition from the Opposition Front Bench, I believe that something more needs to be said about the argument used against the Bill and against narrowing the resident landlord exemption; namely, that it will dry up the stock of letting accommodation.
§ I recognise that where an owner occupier has a spare room or a spare floor, he may be reluctant to let it if he feels he will not be able to get possession if later on he changes his mind and finds that he needs the accommodation. But in the majority of cases that those who work in this field have to contend with, the landlord lives in one floor out of four or five floors. He cannot afford not to let because he has mortgage payments 115 to keep up. So he will either keep on letting—and if my Amendment is passed he will have to recognise the obligation to provide the families to whom he lets with a home—or, if he does not want to do that, let him sell and let the local authority or a housing trust take over the house—and probably they will make much better landlords in that field.
§ I believe that this fear of drying-up the stock of letting accommodation has been grossly exaggerated during the course of this debate. It applies only to the small extra accommodation in what is basically a single household home. There I recognise it has validity. Therefore, this Amendment would allow the owner occupier to let one floor of his home without giving the tenant full protection. But once he lets two floors or more—and anyone who has two or more spare floors to let must have bought far too large a house and is most probably running a business and receiving a fair income—then in those cases they would be outside the proposed exemption to the Bill. I beg to move the Amendment.
My Lords, I too am most grateful to the noble Lord, Lord Shepherd, for the careful consideration he has obviously given to the case that was advanced on Committee stage of restricting the rights of the resident landlord. But I am also forced to agree with the noble Lord, Lord Gifford, that we have not gone far enough here, and that there is no logical distinction between the purpose-built and the purpose-converted block of flats, as the noble Lord, Lord Gifford, has said. Those of us who are familiar with London will be well aware, as he said, that in a place such as Pimlico where you have these large Victorian houses—many of which have five storeys and a basement which can also be let off separately as a flat, so that you have six separate dwellings in all—there can be no logical distinction between a building of that kind and one that was purpo sely constructed to hold six flats in the first place. The noble Lord should perhaps give further consideration to this matter to see whether he cannot draft a form of wording, when the Bill goes to another place, that will take into account the purpose conversions as well as the purpose-built. It surely cannot be difficult for the lawyers to 116 bring in that element as well. The arguments that the noble Lord has advanced in moving his Amendments show that by doing this we shall not dry up the stock of accommodation, particularly in London. That seems to me irrefutable. The cost of large Victorian houses in Pimlico, for example, is very high indeed despite the fallback in the property market, and nobody will withhold accommodation from the market when he is paying high interest charges to the bank or to whoever he has had to borrow the money from in order to acquire the property.
While I am extremely grateful to the Government for what they have done and the extent to which they have met the arguments proposed on Committee, I hope that before the Bill reaches another place they will go a little further and tighten up the resident landlord clause to the extent that we have suggested.
My Lords, the noble Lord. Lord Gifford, has raised a different matter and a very important point and, as he will not be surprised to hear, I cannot accept it. If I understood him correctly, he is saying that there is no difference between a purpose-built block of flats and a large house converted into flats. I should have thought that there were very real differences. I will tell him one. When I was on a planning committee, we used to have a great many planning applications for the conversions of Victorian houses. If a Victorian house is properly converted it can be made into three or four flats which provide very good homes for people. Once it is decided that the resident landlord rule will not apply, it is very easy to see that no one would bother to convert. You will simply have a large house, unconverted, full of people, because then the resident landlord rule would be bound to apply.
It seems to me that there is a very real danger of encouraging a great deal of deteriorating slum property. The noble Lord shakes his head, but I think he has already accepted that this will be so. He said that we were exaggerating the fear of the drying up of accommodation to let, and yet when we had the little debate as to when the Bill was to come into force his great argument for bringing it into force the day after Royal 117 Assent was that so many landlords were going to evict tenants, and so on. One cannot have the argument both ways, arguing first of all that everybody will want to get rid of their furnished tenants and therefore you must bring the Bill in immediately; and three Amendments later saying that this is a grossly exaggerated argument and that no one will want to do so.
My third argument is this. I agree that I am not, like the noble Lord, Lord Avebury, or the noble Lord, Lord Gifford, familiar with conditions in Pimlico, but I can think of other situations where somebody buys a Victorian house. The argument is that it is too large. Very well, it is too large and it is expensive, but they have bought it because they wish to live somewhere reasonably centrally in a town. For many people who buy houses the alternative is either to buy one that is too large and let part of it, or to buy a house a very long way out. Everybody who is concerned about towns recognises that one of the reasons why they have so many problems is that middle class people and people who are slightly better off have gone out from the centre of towns to live somewhere on the edge or in surrounding villages. The result is that we have a multiplicity of problems in towns, and it seems to me that the same argument applies. In the case of buying large houses and making proper conversions and letting the flats, which would be the effect of this Amendment, you could help to create social problems in towns.
I quite accept that you could have a loophole in the case of a purpose-built block of flats where you have a resident landlord and say this is a qualification. I accept this point, but I cannot accept that the same argument applies in the case of the large house. I hope that the noble Lord, Lord Shepherd, will consider that these are very serious arguments.
My Lords, I would agree with the noble Baroness that the case she has put forward is a serious matter. One of the problems I have had in drafting this Amendment was to strike the right balance between the case that was put by my noble friend Lord Gifford and the noble Lord, Lord Avebury, and the problems and difficulties which the noble Baroness has in 118 mind. My feeling was that we had struck the right balance, but perhaps one can never really satisfy one side or the other when striking a balance of this sort. Clearly we do not wish to create a situation where, at least in the mind of a landlord or a potential landlord, things get so tough that he will not put premises on the market. That was very much in my mind when we were considering this Amendment. However, since this is but a step forward, an Amendment which I view for the first time—and I have no doubt that noble Lords have seen it only for a matter of a day or so—I will have another look at this matter and will consult my right honourable friend; but I would not wish to mislead my noble friends into believing that we could go very much further. As I say, one has sought to strike a balance and it is difficult to know where the balance should lie. I thought we had got it just about right, but I will look at it again.
My Lords, may I qualify one or two points raised by the noble Baroness. It is certainly not my purpose in putting forward these Amendments to discourage landlords from making conversions. That was a thought in an earlier Amendment which I put forward which relied on the Race Relations Act criteria, where the landlord who shared facilities would be within the exemption and self-contained lettings would not. This Amendment repeats the effect of the Amendment of the noble Lord, Lord Avebury, on Committee, and would apply whether or not the building was specially converted.
The noble Baroness accused me of trying to have it both ways. This assuredly is not the case. The reason why landlords are seeking possession at the moment is that no doubt they feel—and they may be right—that they will make more money by selling now with vacant possession than by continuing to let under the restriction of the new Act. But once the Act has come into force and the landlord is saddled with tenants to whom he has the responsibility of ensuring protection under the law, then he will decide either to sell or to stomach this Act and re-let. It is unlikely, in my view, that he will leave a large house empty because he does not like giving tenants a home. That would 119 be an uneconomic thing to do. One must remember that the idea of resident landlords with protected tenants is not something new which is being introduced by this Bill. There have been resident landlords and protected tenants ever since rent legislation started. Many landlords and many purchasers of homes have to accept controlled tenants when they buy a house. In my experience there has sometimes been friction, but there has not been a great outcry that we cannot go on having controlled tenants. There has been a recognition of the law allowing controlled tenants to remain in their homes, and this will be the case once this legislation is passed.
In reply to my noble friend Lord Shepherd, I do not want to press this matter further and I accept that he will not only look at it again but will ensure that the matters raised in this House are drawn to the attention of his right honourable friend. I would only say to him that it is not so much a question of striking a balance, that is to say trying to please the landlord lobby and the tenant lobby. That is not the right approach. The right approach is to make a sound political judgment as to the social effect of legislation you are introducing. If the noble Lord and his right honourable friend consider the various points—as I am sure they have—and what has been said in this field, I am sure that they will realise progressively that they are in fact being faced with a landlord lobby. If they look at the situation objectively they will realise that if the law says so people will recognise that tenants should have protection and will not be deterred from making a fair income by that fact. Having said that, I beg leave to withdraw my Amendment to the Amendment.
§ LORD SHEPHERD moved Amendments Nos. 19, 20 and 21. Page 15, leave out lines 32 and 33 and insert— ("(b) the tenancy was granted by a person who, at the time that he granted it, occupied"). Page 15,line 36, after ("(c)") insert ("subject to subsection (2) below"). Page 15,line 39, leave out ("either").
§ The noble Lord said: My Lords, when I moved Amendment No. 17 I spoke to Amendments Nos. 19, 20, 21 and 22. With permission, I seek to move Amendments Nos. 19, 20 and 21 en bloc.
My Lords, I beg to move Amendment No. 22.
(iii) by virtue of section 9 of the Administration of Estates Act 1925, in the Probate Judge, within the meaning of that Act.
the condition in paragraph (c) of that subsection shall be deemed to be fulfilled and, accordingly, no part of that period shall be disregarded by virtue of subsection (2) above.
My Lords, I spoke to this Amendment in moving Amendment No. 18. I beg to move.
(b) is separated horizontally from another dwelling-house which forms part of the same building.
§ The noble Lord said: My Lords, I beg to move Amendment No. 24 and at the same time to speak to Amendment No. 25. These Amendments introduce new subsections into subsection 102(a) of the 1968 Rent Act. Subsection (5) follows from the provisions of Clause 6(3), that in future rates borne by the landlord shall be noted separately on the register of Part VI rents. The new subsection provides that where this has been done and the furnished letting subsequently becomes a protected tenancy because the resident landlord exemption no longer applies, the amount of the rent shall be recoverable by the landlord in the same way as where a fair rent is registered and it is noted in the register that rates are borne by the landlord. Subsection (6) makes provision for the determination of any suspended notice to quit in a case where the furnished letting becomes a protected tenancy because the resident landlord exemption no longer applies. This provision parallels the transitional one in Clause 4 for furnished lettings which become protected on the Bill's commencement date. I beg to move.
§ LORD SHEPHERD: My Lords, I beg to move Amendment No. 25.
§ LORD SHEPHERD moved Amendment No. 26: Page 19, line 30, after first ("tenancy") insert ("(a)").
§ The noble Lord said: My Lords, I beg to move Amendment No. 26 and also to speak to Amendment No. 27. These Amendments introduce a technical amendment to sub-paragraph (4) of paragraph 2 of Schedule 3, to make good a minor omission in the Bill as drafted. They also provide in the new sub-paragraph (4A) that the rent registered under Part VI for a furnished letting shall be deemed to be registered under Part IV when the furnished letting becomes a statutory tenancy by virtue of the provisions of sub-paragraph (4). Clause 4 makes a similar provision for lettings which become protected by virtue of Clause 1 of the Bill. I beg to move.
My Lords, I beg to move Amendment No. 27.
§ LORD SHEPHERD moved Amendment No. 28. Page 20, column 3, leave out lines 15 and 16.
§ The noble Lord said: My Lords, I beg to move Amendment 28 and speak to Amendment 29. Both these Amendments are consequential on the deletion of paragraph 9 of Schedule 1, and they were Amendments No. 14 and 15 on the Marshalled List. I beg to move Amendment 28.
My Lords, we have now reached the Third Reading of this Bill and I feel I cannot let this occasion pass without first of all saying to the noble Lord, Lord Shepherd, how grateful I am for the help that he has given to me. I must, however, indicate to him that, as I have said during the various stages, this Bill is not one which we on this side of the House can accept in principle. Although I have no doubt that it will be hailed as part of the "social contract"—or is it "social compact"?—and I accept that it will help those in furnished accommodation at present, there will be a great many people who will not be helped. I refer particularly to young married couples and young people generally, and anyone who needs for one reason or another to move about because of the nature of their employment. For this reason, I think the Bill will have a serious effect on our economy as a whole.
125 The noble Lord, Lord Shepherd, said at an earlier stage, and he has repeated to-day, that he proposes to have discussions with local authorities on the effects of this Bill. I should be very interested to know, because presumably this is a matter to which the Government have given some attention, what advice and guidance they intend to give to local authorities in the light of the difficulties this Bill will create for a number of people. In particular, is the noble Lord going to advise them to review their housing programmes and to provide more accommodation for single people—perhaps a fixed proportion of it? This would meet the case of students or young people looking for work in cities. It would help, if it were, say, a onebedroomed flat, which would give a home of their own to a young married couple starting out in life. Will the noble Lord give local authorities guidance on how they are expected to help people who have to find temporary accommodation because of the nature of their work?—because in my experience this will bring a very new principle into local authority accommodation. It would mean that some accommodation would need to be left vacant for the person who might require it for a given but unexpected short time.
The Government have said quite consistently throughout the passage of this Bill that they expect the private landlord to disappear and they expect accommodation to be provided by local authorities, either by building it themselves or by buying up private houses. It is only right therefore that they should tell the House what advice they propose to give to local authorities about meeting these problems, because they are very real ones and, to the best of my knowledge and belief, very few housing committees will consider them at all. They will say they have long waiting lists for families, and these represent their first priority. So the net effect of this Bill will be that local authorities, unless urged to do so, will not meet the need, and the private landlord will not do so because of Bills of this nature.
I cannot give a welcome to this Bill, because it seems to me it will have the most unfortunate consequences. I believe that many people, if they can, will gain possession of their property and will begin 126 to do so very rapidly. I regret to say that I see an increase in the amount of dilapidated property because the good landlord who expects the gap between tenants to be a time when he can do the necessary internal repairs and redecorations (for which of course he will be responsible in the case of furnished property), will find great practical difficulties in the way of doing this. Therefore, we may see far more dilapidated property.
I suspect that as a result of the Bill we shall see more of the bed and breakfast accommodation. Houses which were let as flats will become kinds of pseudo-hotels. I cannot see that this will be a desirable improvement. There will undoubtedly be a decrease in the choice of housing available to people. I know that it is difficult for many people to find the kind of accommodation they would like. But as a result of the Bill, there will undoubtedly be still less accommodation. I do not genuinely believe it will help the problem of homelessness. I know many people in housing are concerned because homelessness is so often caused because tenants are evicted from private furnished accommodation. But people only accept that accommodation because there is nowhere else for them to go. Unless someone provides that accommodation for them, they will simply not have the private furnished accommodation into which to go.
I do not believe that the Government have considered this problem of homelessness. The Bill could make the situation worse rather than better, because whatever we may say to the contrary, it is a sad fact that despite all the houses built since the ending of the War, the problem of homelessness remains with us in a form which did not exist before the war. It is difficult not to draw the conclusion that a great deal of homelessness has been caused because of the shrinking private market to which this Bill will simply add. There will be many hardship cases. We hear much about bad landlords, and I accept that there are bad landlords. But there are many good ones. Many landlords and tenants have over long periods of time enjoyed perfectly happy relations. For a great many of these people the Bill will not make matters any better. My Lords, for all these reasons we on this side of the House do not support the Bill.
Having said that, I wonder whether I could say a brief word to the noble Baroness opposite. On every occasion when we have discussed the Bill the noble Baroness has talked at some length about three particular groups of people whom she feels will be hard done by: young married couples, young people and people moving homes. One group she has not talked about at such great length are those people who are being made homeless daily from the furnished sector. Two-thirds of all families becoming homeless come from the furnished sector. In some areas it is considerably more than that. The Grieve Report on Homelessness found in 1969 that 52 per cent. of all applicants for emergency accommodation came from the furnished sector. The noble Baroness, and her supporters opposite, might at least give equal weight to the misery which this homelessness is causing daily, as opposed to the hypothetical dangers which the various groups she has mentioned so often may face when the Bill becomes law.
One cannot help being young, but people in the other two categories may in theory make a conscious decision as to whether to set up a home or to move home. That contrasts starkly with the group of people who can wake up in the morning and find a notice to quit on their doormat and face homelessness within a matter of months. I do not believe that the noble Baroness is being entirely accurate when she says that this is a group 128 who have nowhere else to live. On the whole, people being made homeless from the furnished sector have lived in the accommodation for a very long time. They have not taken the accommodation on in a desperate search for somewhere to live. Certainly, in Pimlico people have often lived in the area for 30, 40 or 50 years. They have worked and lived in that area and are thrown out only when the landlord decides to sell the property and make more money in that way. I think that the noble Baroness ought to take into account that this Bill will prevent that ruthless throwing out by landlords of tenants who have families and who have been living in the accommodation for long periods of time.
Having said that, I accept, as everybody in this House has accepted, that this Bill will not increase the amount of furnished lettings and will probably add to the general decline which has taken place over the years in both unfurnished and furnished lettings. This Bill is a first step in a programme, which will continue in the future under this Government, of the provision of alternative sources of housing accommodation. After the Bill becomes law it must be followed by an increase in housing association housing and by an increase in building, particularly of council houses, as well as an increase of houses taken into municipal ownership. This is already starting to happen in Central London. My Lords, this Bill is an excellent first step and bodes well for the future.
My Lords, may I reply in a most sincere way to the short debate that we have had on Third Reading, and thank the noble Baroness, Lady Young for the work she has put into this Bill? A great deal of work has been involved because anything connected with rent legislation is extremely complex and takes a great deal of time, even when assistance is provided, to understand it. May I also say to my noble friends Lord Gifford and Lord Melchett now much I have appreciated their own contribution and persistence in matters about which they feel so strongly. In the case of my noble friend Lord Melchett, I do not need to say anything more in regard to this Bill and the reasons why it has 129 been introduced, because he has done so in a most admirable form.
At the end of the day, there is only one solution; that is, more housing, both public and private. When the noble Baroness, Lady Young, speaks most feelingly about the homeless and about the shortage of accommodation, I cannot but reflect that she was a Member of a Government which saw continuously over the years a gradual, steady, persistent decline in housing built for local authorities and, in more recent years, even in the private sector. I say to the noble Baroness, with the utmost friendship, that when this Government took office in February we found the building industry knocked to pieces. It will require a great deal of effort by the present Administration to get the building industry to have sufficient confidence and resources, both of money and manpower, to be able to deal with the major problem that confronts us—the provision of houses for the local authority and private sectors. It is indeed a damning indictment of the previous Administration if one looks in this particular field.
In regard to my friend Lord Melchett and his point about furniture, I understand there is a letter in my box tonight for me to sign, and I hope that he will receive it tomorrow. There was only one further aspect that I would deal with. I accept from the noble Baroness the very great need for publicity of this legislation to be given to both landlords and tenants. I will write to the noble Baroness as to what we intend to do, but I give an undertaking that we will pursue the same sort of campaign as on previous rent legislation in order that all the interested bodies will have adequate leaflets and material so that they can understand this complex legislation.
The Bill now goes to another place. We have done a good deal of useful work on it. I hope we may have saved some time in another place because I share with my noble friend Lord Melchett the feeling that this legislation is necessary. I cannot help but feel that when it is passed there will be many thousands of people who will go to bed feeling a little more secure in their tenanted residences than they now do. If that is so, then this legislation is worth while.
§ Bill read 3a; an Amendment (Privilege) made.
My Lords, I should like to thank the noble Lord, Lord Shepherd, for the very kind remarks he has made. I have found this Bill an interesting but a difficult one, and I am grateful for all the help I have received, in particular for the notes on clauses and for the opportunity of discussing the various technical points with members of his Department, for whose help I have always been and remain grateful. Having said this, which I do sincerely, I would draw the attention of the noble Lord, Lord Shepherd, to something he perhaps did not intend to do, which was to move a manuscript Amendment as he did on Report stage. I have now had an opportunity to look at the Companion to Standing Orders. Although I realise that it is probably not for me to advise the House on them, the Order in fact states that "manuscript Amendments are not out of order on Report but the disadvantages and inconvenience attaching to the moving of manuscript Amendments in Committee are even greater on Report than at the Committee stage".
My Lords, would the noble Baroness proceed, because if she does she will see there are occasions when it is quite right to move manuscript Amendments in order to make an adjustment or to meet a point that has already been made with force.
My Lords, I was not going to go on to say that anything the noble Lord did was out of order, but it is difficult when we have agreed on this side to take this Bill quickly through the House. We have had only a week between Committee and Report. We have had all the difficulties of printing, and we have known and accepted the reasons for the difficulties. We have tried to deal with these very complicated matters quickly. And then we are confronted with a sequence of manuscript Amendments, one of which was not written down. It makes the situation quite difficult. I leave the point at that. I would not have raised it at all, but I believe it to be a quite serious issue that we now have only two weeks between the Royal Assent and this Bill's coming 131 into effect, instead of the month as the Bill has suggested. I have not had an opportunity to find out whether this is a usual practice, nor indeed have I any idea of the numbers of people who are likely to be severely inconvenienced by it. But I leave the point there. I feel, however, I should in fairness make it for the many people who will have to study this Bill. I do not wish to end on a disagreeable note, because I have been grateful for the help and co-operation we have received, and I have been grateful to those on this side of the House who have supported me in my Amendments.
My Lords, I am grateful for what the noble Baroness has said. I will certainly take note of her—I will not say criticism but her admonishments. I felt that on this particular occasion there was substance in the points which my noble friends had put to me. I had intended to resist, but I took into account the powerful arguments they had put, and responded to them. I am grateful for what the noble Baroness said.

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