§ Mr. Willey
I beg to move Amendment No. 51, in page 29, line 36, leave out from beginning to 'High' in line 37 on page 30 and insert:(1) Where, in the case of any area which is occupied directly or indirectly under tenancies held from one landlord (apart from property occupied by him or his licensees or for the time being unoccupied), the landlord on an application made within the two years beginning with the commencement of this Part of this Act obtains from the Minister a certificate that, in order to maintain adequate standards of appearance and amenity and regulate redevelopment in the area in the event of tenants acquiring the landlord's interest in their house and premises under this Part of this Act, it is in the Minister's opinion likely to be in the general interest that the landlord should retain powers of management in respect of the house and premises, or have rights against the house and premises in respect of the benefits arising from the exercise elsewhere of his powers of management, then the High Court may, on an application made by the landlord within two years of the giving of the certificate, approve a scheme giving the landlord such powers and rights as are contemplated by this subsection.For purposes of this section 'the Minister' means as regards areas within Wales and Monmouthshire the Secretary of State, and as regards other areas the Minister of Housing and Local Government.(2) The Minister shall not give a certificate under this section unless he is satisfied that the landlord has, by advertisement or otherwise as may be required by the Minister, given adequate notice to persons interested, informing them of the application for a certificate and its purpose and inviting them to make representations to the Minister for or against the application within a time which appears to the Minister to he reasonable; and before giving a certificate the Minister shall consider any representations so 1589 made within that time, and if from those representations it appears to him that there is among the persons making them substantial opposition to the application, he shall afford to those opposing the application, and on the same occasion to the landlord and such (if any) as the Minister thinks fit of those in favour of the application, an opportunity to appear and be heard by a person appointed by the Minister for the purpose, and shall consider the report of that person.(3) The Minister in considering whether to grant a certificate authorising a scheme for any area, and the.I can perhaps explain at the same time, for the benefit of the Whips, that having considered the related Amendments set down, we propose to accept the Amendment to this proposed Amendment, in line 12, leave out 'two years' and insert 'one year', and Amendment 61, in page 34, line 7, leave out 'two years' and insert 'one year'.
This is a matter we discussed in Committee. We think the first period of two years is right and that it would be wrong to extend it. I can see the argument for extension, bearing in mind the point which the hon. Member for Crosby (Mr. Graham Page) raised in Committee, that we recognise that some estates are being built and that it will be some time before we can get the Wilberforce legislation but on the second period, the view was canvassed in Committee that it should be reduced to one year.
The Amendment is to meet the points made in Committee and made in representations by spokesmen of well-managed estates. We have endeavoured, first, not to confine this to estates in the way we did in the Clause as originally drawn. In other words, we accept that the Clause was at first drawn too narrowly, and also in subsection (2) we have put the Minister under the specific obligation to hold an inquiry where there is substantial opposition. I think we have, in this way, improved the provisions of the Bill. I assure the House that, having discussed this and listened to the arguments in Committee, we have done our best to meet the wishes of the well-managed estates.
§ Sir H. Lucas-Tooth
I wish to comment on the right hon. Gentleman's acceptance of the Amendment to substitute "one year" for "two years" in line 12 of the proposed Amendment that we are discussing. I do not know whether he has spoken to any of his neighbours on the subject, but I can assure him 1590 that many people have been to see me and have expressed their strong objection to any suggestion that the period of two years should be reduced. I have had representations that a period of five years, as suggested in the Amendment in the name of my right hon. and learned Friend the Member for Hexham (Mr. Rippon), would be preferable.
I do not know that this is a matter of great importance. I do not think this provision will really operate, as I shall develop on a later Amendment. At the same time, I should like to place on record my strong objection to the proposal to reduce the period from two years to one year.
§ Mr. Willey
Perhaps I can set the hon. Gentleman's mind at rest. We have not sought to reduce the first-mentioned period of two years. I understand the reasons for this point being raised, but we feel that it would be wrong to reduce that period. Similarly, we have not accepted the proposal to extend that period to five years.
§ Mr. Graham Page
It is the first-mentioned period which is important. A period of two years goes some way to help, but I wish it could have been five years. It would have covered the situation better. I do not complain about the reduction of two years to one year in the second case. I think the right hon. Gentleman has improved the Clause, so far as it will have any use at all. Frankly, I do not think it will have any purpose. I do not think anybody will take advantage of it. I do not think there is any purpose, when a landlord has had his estate broken up, in asking him to manage it.
I think the right hon. Gentleman has got things the wrong way round. He should have put himself in the position of the High Court, and the High Court should be in the position of himself. We argued this in Committee, and I merely put on record my belief that the Clause is wrongly shaped, and I do not think there is any purpose in it.
§ Mr. S. C. Silkin
I should like to say a few words on behalf of my hon. Friend the Member for Birmingham, Northfield (Mr. Chapman), two of whose Amendments have been accepted by my right hon. Friend—one to my right hon. 1591 Friend's proposed Amendment and, I think, a consequential Amendment later on. My hon. Friend the Member for Northfield regrets his inability to be here, but he asked me if I would deal with his Amendments on his behalf, and I am certain that he will wish me to thank my right hon. Friend for accepting those two Amendments.
As to the first period in my right hon. Friend's Amendment, which is the subject of another Amendment by my hon. Friend the Member for Northfield, no doubt my hon. Friend would wish to press that Amendment. Although I take the view, and expressed it in Committee, that these periods ought to be as short as is reasonably practical, none the less there is a built-in incentive to the freeholder so far as the first period is concerned to take action as rapidly as possible, because if he does not do so he is liable to find that lessees have given their notices to acquire the freehold before those notices have taken effect and before the lessor's application can intervene to suspend the effect of those notices. I think my right hon. Friend is perfectly right to curtail the second period rather than the first, in view of that incentive.
I turn to the Amendment in my name. The words now proposed to be used in my right hon. Friend's Amendment are somewhat different from those that appeared in the original Clause. In particular, we now have inserted in the Clause the expression "and regulate redevelopment". In other words, the Minister is able to give a certificate in accordance with Clause 19 if he takes the view that this is necessary not merely to maintain adequate standards of appearance and amenity—that phrase appeared previously—but in order to regulate redevelopment in the area.
Precisely what that means I do not at present know. I am extremely unhappy about that expression and extremely worried about its possible implications. Does it mean that the freeholder would be entitled to make a case to the Minister to the effect that he should continue to be in a position to say when redevelopment ought to take place? Does it, in other 1592 words, go to give the freeholder positive powers of deciding when redevelopment should take place? Or are the powers that are meant to be implicit in the Clause negative powers simply to say when redevelopment ought not to take place?
This is extremely important because the power of the court to approve a scheme includes a power to give effect to the matters which the Minister has to have regard to when he gives his certificate. If "regulate redevelopment" has the positive meaning to which I referred, then it would apparently give the court the right to tell the freeholder "You can have the power to tell the enfranchising lessee when he must pull his house down and when he must redevelop." That seems to me to be completely wrong. There is no case for it. It is contrary to the whole principle of the Bill. If there is a case for redevelopment we have the Land Commission and the planning powers, which will enable redevelopment to be given effect to.
The words "regulate redevelopment" seem to me to be open to that meaning. If there is any ambiguity about them, I suggest that other words should be substituted which make it clear that there is not that positive power. But even if there were only a negative power, I still do not understand why it should be necessary for the freeholder in the exercise of his powers under Clause 19 to be able to tell the lessees who are now enfranchised "You must not now redevelop". Why is that not a proper subject for the exercise of ordinary planning powers, and why should that power be given to the former freeholder?
I can well understand that the sort of power that ought to be given is a power if redevelopment takes place, to say what sort of redevelopment it ought to be. That is an entirely different matter. If that is all that is meant, then I should have no objection. But the term "regulate redevelopment" seems to me to be far too wide. I hope that my right hon. Friend will say exactly what he has in mind, and if it means something much less than I fear that it may mean I hope that he will look at the wording again so that at a later stage the limitations of this power may be made absolutely clear.
§ Mr. Willey
I agree with my hon. and learned Friend the Member for Dulwich (Mr. S. C. Silkin) that the ordinary planning powers would apply.
We are trying to recognise the particular character of well-managed estates and to make special provision for it. The words "regulate redevelopment" are negative in connotation, but I do not want to over-emphasise the negative aspect of the regulation of redevelopment. We are recognising that a well-managed estate is not static but is both present and future. For this reason, to preserve and maintain the character of the estate it is proper to make provision for regulating redevelopment.
§ Mr. Luard
I share some of the concern expressed by my hon. and learned Friend the Member for Dulwich (Mr. S. C. Silkin) about the phrase in the Amendment providing for regulating redevelopment and I should be grateful if the Minister would clarify it. The Clause, as I understand it, is intended to apply to areas where there is large-scale development, all of a similar type, normally being carried out at the same time with houses of a similar type.
I do not want to be too parochial in speaking about the situation in Oxford, but circumstances have arisen in a certain part of Oxford which are relevant to the Clause. It is an area where there are houses of many different types, and also shops—an area of some size but not one of comprehensive development of a uniform kind. I strongly suspect that the landlords of the area—St. John's College—have it in mind to claim that this area represents a well-managed estate for the purposes of the Clause. Within the last two or three months they have set aside this area as being a single estate for which they plan a certain kind of development. The leaseholders of the area would be very disturbed if they learned that, as a result of the Clause, although they would have the right to enfranchisement, they would not have the normal right of redeveloping the plot concerned which they would expect to acquire with the right to enfranchisement.
Although tenants of an estate which has all been developed in a similar way in the past will perhaps be prepared to 1594 understand the reasons for limiting and controlling their rights to redevelop, that will be totally unacceptable to people living in an area where every house is separate and different and there is nothing at all to distinguish the area and give it character of an estate other than the fact that the landlord of all the houses is the same. I should be grateful to the Minister if he would clarify these words in order to make it clear, in any subsequent interpretation, that the Clause is not intended to cover an area of that kind.
§ Mr. Moyle
I should be grateful if the Minister would clarify for my hon. Friends and myself the meaning of the phrase "regulate redevelopment". As far as I understand, it is not a legal term of art. I have never seen it used as a term in conveyancing. It is an entirely new term, and it strikes me as an incredibly vague term.
I regard the reply which the Minister gave to my hon. and learned Friend the Member for Dulwich (Mr. S. C. Silkin) as totally unsatisfactory. To put it at its worst, what will happen to the idea of security of tenure with this provision written into the Bill? Will there be any terms for compensation if the landlord is allowed to take over a tenant's house and redevelop it? If so, what are to be those terms? Is it envisaged that care will be taken of such problems? We should have an answer to those questions, as this is a very important matter.
§ Mr. Willey
Two points have been made. I said that we have provided that the Clause is not so narrowly drawn, so that estates previously excluded may now qualify. We are primarily considering the character of the estates. On redevelopment, we recognise that, if this is a well-managed estate and satisfies the criteria, development would affect its character. We provide for enfranchisement within its desirable and well-managed environment, but the regulation of redevelopment must obviously affect its character. That is why we have made this reference to it.
§ Question, That the words proposed to be left out stand part of the Bill, put and negatived.
§ Question proposed, That the proposed words be there inserted in the Bill.1595
§ Amendment to the proposed Amendment made: In line 12, leave out 'two years' and insert 'one year'.—[Mr. S. C. Silkin.]
§ Proposed words, as amended, there inserted in the Bill.
§ Mr. Willey
I beg to move Amendment No. 54, in page 30, line 43, at the end to insert:';but regard may also be had to the past development and present character of the area and to architectural or historical considerations, to neighbouring areas and to the circumstances generally'.This Amendment goes with one which we have already discussed, which enlarges the factors which the High Court can take into account in deciding whether or not to approve a scheme put forward by the freeholder of an area for which a certificate has been granted. It allows the court to take into account not only the benefit to the area as it stands but also its past development, any architectural and historical considerations, and the general environment of the area.
§ Mr. Clegg
I give a qualified welcome to the Amendment, which widens the court's scope, but Clause 19 is weakly and will be of singularly little use. Why has the Minister differentiated between the properties of private landlords and those of the Crown? On 31st March, in a Written Reply to his hon. Friend the Member for Woolwich, West (Mr. Hamling), he said:The various Crown authorities will agree to enfranchisement and extension of leases for qualified leaseholders holding from the Crown on the terms provided for in the Leasehold Reform Bill, except that enfranchisement will be refused where the house is of special architectural or historic interest or adjoins such houses and is important in safeguarding them and their surroundings …"—[OFFICIAL REPORT, 31st March, 1967; Vol. 747, c. 42.]In these cases, it seems that the tenant will not be able to enfranchise his holdings. The right hon. Gentleman is not applying the same criteria to the houses which are the freehold of a private individual, but is drawing a distinction.
Another Clause deals with National Trust properties, tenants of which, subject to certain qualifications, will not be able to obtain enfranchisement. Perhaps the Minister would tell us why he draws this distinction between Crown properties and properties the freeholder of which is a private individual or company.
§ 12.30 a.m.
§ Mr. Willey
I congratulate the hon. Gentleman on his ingenuity, which I have always admired. He had an Amendment down which was not unrelated to this matter. This is not related to the point which we are discussing. But I take his point about buildings of historic or architectural value which are in the hands of the Crown. The analogy is the analogy which he made: it is more with the National Trust. We recognise that there are some properties in the hands of the Crown which are held for the nation because of their historic and architectural interest. It is for those reasons that enfranchisement would be inappropriate.
§ Amendment agreed to.
§ Further Amendments made: No. 55, page 31, line 1, leave out '(2)' and insert '(1)'.
§ No, 56, page 31, line 2, leave out 'notwithstanding subsection (2)'.
§ No. 57, page 31, line 13, leave out '(2) to' and insert '(3) and'.
§ No. 58, page 32, line 11, after 'the', insert 'redevelopment,';
§ No. 59, page 33, line 18, leave out from 'that' to 'as' in line 19 and insert 'a certificate could in accordance with subsection (1) above be given'.
§ No. 60, page 33, line 33, leave out 'subsection (2) above' and insert 'this section'.—[Mr. Willey.]
§ No. 61, page 34, line 7, leave out 'two years' and insert 'one year'.—[Mr. S. C. Silkin.]
§ Mr. Maddan
I beg to move Amendment No. 62, in page 34, line 16, at the end to insert:(14) Where pursuant to a certificate issued under subsection (2) of this section application has been made to the High Court to approve a scheme and the landlord shows to the satisfaction of the High Court that the area is held under statutory enactment or trust deed and that the profits therefrom are used for some public or charitable purpose the High Court shall be empowered to approve a provision in the scheme enabling the landlord to retain such development rights in respect of the house and premises for any user additional to that provided in the tenant's lease current at the time of acquisition by the tenant of the landlord's interest in the house and premises.In the event of such a provision being included in a scheme then the purchase price to be paid by the tenant under section 9 of this 1597 Act shall ignore any value attaching to the development rights retained by the landlord.The Amendment is inspired by the troubles which Letchworth will find itself in as a result of the Bill's passage, because Letchworth has never had the disease which the Bill seeks to cure. The tenants there have always had security of tenure on land value only. I will deal briefly later with the point which the Joint Parliamentary Secretary made in Committee when he cast doubt on that aspect.
My main point can be introduced by reference to what the Minister said on an earlier Amendment today about rateable value. He said that the purpose of the Bill was to deal with those areas which suffered the worst hardship under the leasehold system. The fact is that no hardship is being suffered under the peculiar leasehold system of Letchworth. Also, the Bill damages the community of Letchworth because the Corporation holds the land for the benefit of the community. The Amendment seek to help the Corporation financially, though it will not help it in some of the larger battles.
May I read the concluding phrase of the leading article in The Times of 4th May which referred to the effect of the Bill on Letchworth.Now it"—that is, Parliament—is being whipped into passing another Act which has the incidental effect of undermining them"—that is, the principles embodied in the Letchworth experiment—and this in spite of the fact that by taking account only of site value in the renewal of leases Letchworth already observes one of the rules which the Leasehold Reform Bill is most concerned to establish.The purpose of this Amendment is to retain for the community in Letchworth—and it could be elsewhere—the increment in the development value which will arise if the enfranchised leaseholder redevelops within the period of the lease plus the 50 years' extension.
Now the right hon. Gentleman says the corporation has not compulsory powers and therefore it could never have benefited from such redevelopment anyway. If that is what he continues to say, I think there is a misunderstanding.
1598 The practice is this. In Letchworth, lessees have been in the habit of coming to the corporation seeking extensions long before their leases are running out and when they have 40 years or even 60 years to go. When that happens the new ground rents are agreed. Now the leases naturally provide that any change of user can only be made with the consent of the Corporation. Perhaps the leaseholder wants to build a bungalow or two in his garden.
Previously—and upstairs in the Committee—great play has been made about Clause 17 giving the freeholder the right to regain possession for redevelopment purposes, and therefore it has been alleged that the full redevelopment value is going to go back to the landlord anyhow. But I do not think this is true for a number of reasons, one of which is that Clause 17 only envisages a situation where premises are going to be actually demolished and reconstructed. I did develop many other reasons in Committee, but I am not going to restate them tonight, and that is the main one. This may be related to the point we have been discussing about regulating redevelopment, although I do not know that it is.
But the consent of the landlord to further development is only given to the leaseholder at the present time for a quid pro quo in the form of a higher ground rent, and this also brings forward revenue to the corporation which otherwise it would have to wait to the end of the lease to realise. Under the Bill, this right to a quid pro quo goes into the pocket of the enfranchised leaseholder and not into the benefit of the corporation on behalf of the community.
The Minister's statement on the need for compulsory purchase powers, to which I have alluded, is, I think, wide of the mark for another reason, and I think he may have had in mind the 1954 Rent Act. If that is what he has in mind this difficulty can always be overcome in Letchworth by the Letchworth Urban District Council acting on behalf of the Corporation, so that really there is no great lack of compulsory powers here should they be required.
What the Amendment does is to give the High Court power to grant to well-managed estates held under Statute or trust deeds and whose profits are used 1599 for some public or charitable purpose the right to future development value. The Amendment, I would like to stress, is not otiose—one of the right hon. Gentleman's favourite words—because so far as I can see without it the High Court might decide that such provision is ultra vires. The Amendment can serve a useful purpose.
The Amendment is to Clause 19 and not Clause 29, as might have been expected, because the right hon. Gentleman has consistently although illogically said that any relief for Letchworth must come under Clause 19.
I conclude by emphasising that the Amendment will bring only partial relief for Letchworth. The only proper, logical and fair, course is to exclude Letchworth from the provisions of the Bill. At the beginning of my remarks I pointed out that in Committee the Parliamentary Secretary had cast doubts on the security of the leaseholders of Letchworth. He pointed out that under the Letchworth Garden City Corporation Act the Corporation can extend and renew leases. I understand that the Corporation will, in the event of its being excluded from the provisions of the Bill, introduce a Private Bill to enshrine this policy as a statutory duty and will pay compensation at the fair market price, including the assumption that the lease is extended by 50 years. In the meanwhile, the Amendment will give Letchworth the opportunity of a little financial relief from the adverse effects of the Bill, and I hope that it will have the support of the Government and all hon. Members.
§ Mr. Graham Page
As an acknowledgment of my hon. Friend's determination and gallant persistence in the cause of Letchworth, I hope that the right hon. Gentleman will accept the Amendment.
§ Mr. Willey
I certainly join the hon. Member in taking note of his hon. Friend's gallant persistence, but I am surprised, at this late stage in our dialogue, that he should expect me to be ready to accept the Amendment. On the question of development value there is complete accord between Ebenezer Howard and his followers and the Government. Ebenezer Howard and his followers at Letchworth believe that there should be 100 per cent. betterment levy. This is the difference between us.
1600 The Amendment relates to the discussion we had on Clauses 28 and 29 in Committee. We were able to meet Letchworth on Clause 28, but not on Clause 29, and the hon. Member, with his usual ingenuity—which again I admire—is raising the matter on this Clause. The difficulty is that the Letchworth Corporation has no compulsory purchase powers, and therefore has not the machinery to enforce the purpose of the retention of the development rights.
The hon. Member referred to the provision concerning the regulation of the redevelopment of an estate. What he said should have reassured my hon. and learned Friend the Member for Dulwich (Mr. S. C. Silkin). This is the difficulty facing Letchworth. It is a question of not having compulsory purchase powers. As far as I know there are no leases with less than 40 years to run in Letchworth, so Letchworth, by the fact that it is subject to the leasehold system, is precluded from redevelopment except by buying out leaseholders. That matter has been previously discussed in our proceedings.
If the Letchworth Corporation is going to seek powers under a Private Bill it may well decide that it should seek compulsory purchase powers. This would be a question of some importance—it would be a question whether Parliament should accord compulsory purchase powers to such a public body. Unless that is done, unless Parliament so decides, there are very real difficulties about this. That was why I dealt with Clauses 28 and 29 together. We were happy to meet the case of Letchworth under Clause 28, but we could not do so under Clause 29 because of the difficulty which I have mentioned.
§ 12.45 a.m.
§ Mr. Maddan
The purpose of redevelopment value is not necessarily simply for central area redevelopment, as the Minister imagines. Anybody in an outlying area who decides to build three bungalows in his garden does so to his private gain and, therefore, at the expense of the community, who at present have the benefit of that development value because, as a leaseholder, such a person has to come back to the corporation to get permission for the redevelopment. Once he is enfranchised, that has gone. As for central area development and, 1601 possibly, the need for compulsory purchase powers and to bring in a lot of leases at the same time, I reiterate that the urban district council would act for the corporation if that was necessary. Therefore, that is not required.
I know that the Minister is to see representatives of Letchworth next week. I hope that he will tell us that he will see them in a frame of mind sympathetic to what they are trying to achieve and that he will be determined to try to understand their point of view, which, I am certain, they will put more eloquently than I have done, because I certainly do not seem to have made my point sink in.
§ Mr. Willey
I would be surprised if the eloquence of the delegation from Letchworth, gracious though it may be, matches that of the hon. Member. I assure him that I am anixous to meet the representatives of Letchworth and to persuade them that what we are doing is not to the prejudice of Letchworth.
I share the hon. Member's admiration of the Letchworth Estate and its management. I have, however, undertaken to see the delegation again. As the hon. Member knows, the point mainly at issue is whether Letchworth is prejudiced by the terms of compensation under the Bill in relation to the terms of compensation under which it acquired the estate.
§ Amendment negatived.
§ Sir H. Lucas-Tooth
I beg to move Amendment No. 63, in page 34, line 16, at the end to insert:(14)(a) If the Minister is satisfied that a body
he may certify that body as a body for the purposes of this subsection and this certificate shall define the area to which it relates;
- (i) sufficiently represents the interests of the tenants of houses in an area as regards which the requirements of subsection (1) above are in his opinion satisfied; and
- (ii) has been properly appointed or constituted; and
- (iii) is so constituted as to be able to perform the functions to which this subsection relates,(b) subject to the provisions of this section any body certified by the Minister under paragraph (a) above may apply to the Court for approval of a scheme relating to the area defined in the certificate and accordingly the expression 'landlord' in this section shall, where the context so admits, include any body so certified by the Minister:1602Provided that when the expression 'landlord' includes such a body, subsection (5) above shall be modified by substituting for the words 'a degree of control out of proportion to that previously exercised by him' the words 'a degree of control out of proportion to that previously exercised by the landlord'.In moving the Amendment, I am particularly concerned with the Hampstead Garden Suburb, a substantial part of which is in my constituency. It is certainly one of the best-known and best-run areas of the kind which we are considering under the Clause. I might mention that it has among its residents and among my constituents the Prime Minister, the Minister without Portfolio, the right hon. Member for Easington (Mr. Shinwell) and the Minister in charge of the Bill. That accounts, perhaps, for the size of my majority.
Hampstead Garden Suburb is a homogeneous area. All the houses are leasehold. They are now all owned by the same landlord, although on a variety of leases and subject to various conditions and terms. A large majority of the tenants in the area are extremely concerned about the effects that the Bill will have upon them. I do not know whether they speak to the Minister about this, but they certainly speak to me and they sent a deputation to see me. There is among them a strong and understandable desire that they should preserve not only the amenities of the garden suburb, but the general character of the area, a view with which, I think, the Minister will agree.
The rules which have made the suburb what it is and which govern it are enshrined in the leases which have been granted to the various tenants. These rules include positive and negative covenants of the most stringent kind. Undoubtedly, when enfranchisement takes place it will put a complete end to these rules and leave the suburb without any control whatsoever.
I do not think I need say that the general planning law is quite inadequate to deal with this situation. I will grant the Minister that Clause 19 as amended might be satisfactory to deal with it. I am not saying that it is perfect or what I would have asked for but at any rate it will go some way towards dealing with the situation. But the trouble about the Clause, even as amended, is that it 1603 can only be brought into operation by the landlord himself.
Although I have no quarrel with the present landlord of the suburb—it is an immense undertaking with immense resources—I share the apprehensions of my constituents about the probability, to say the least, that the landlord will not take the necessary action. I cannot see why he should do so.
These are all leasehold properties, the great majority of which will come within the purview of the Bill. It is surely inevitable that, sooner or later, probably sooner rather than later, a very large proportion of my constituents will seek to enfranchise their leaseholds and convert them into freehold properties. If that is so, why should the landlord merely saddle himself with an immense responsibility? I do not think that there is any reason to hope that he will do so.
During the Committee stage, an Amendment was moved by the hon. and learned Member for Dulwich (Mr. S. C. Silkin) in similar terms to this Amendment and the Joint Parliamentary Secretary was very sympathetic. He concluded his reply by saying:… but we certainly would be prepared to have another look to see if there is any practical way in which we could do what he wants."—[OFFICIAL REPORT, Standing Committee B, 4th May, 1967; c. 654.]What the hon. and learned Gentleman wanted was, roughly speaking, what I want today. The only difference is that, whereas he wanted to empower the local authority to come, I do not wish that, nor, I understand, do my constituents.
The Joint Parliamentary Secretary gave the reasons for not accepting the Amendment moved by the hon. and learned Gentleman under four heads. I am not certain that they came to four, but he said there were four. I will analyse what he said. First, he said that it would be difficult for the Minister to decide which group of tenants should be empowered to exercise these powers.
My Amendment proposes that the powers should be vested in a body—which is a word used in the Bill so there is nothing in new or extraordinary about it in this context. As the right hon. Gentleman knows, the Hampstead Garden Suburb is at present at work upon the drafting of a Private Bill to consti- 1604 tute just such a body. So we would meet that by this Amendment. It is proposing to create a corporation, to be constituted of eight members, four being appointed one each by the Law Society, the R.I.B.A., the Royal Institute of Chartered Surveyors and the National Trust. I believe that all these bodies have consented to act. The other four members would be elected by local residents.
In the second place, the Minister said that it would be difficult to define the area in question. That seemed a somewhat thin argument, and, in any case, it is covered by the present Amendment. In the third place, it was objected that a group of tenants could delay enfranchisement. I need only state that objection to show what nonsense it is. In the present case, the tenants want this proposal. There may be an odd one who does not, but a little delay here will do no one any harm. In the fourth place, it was asked, who is to appoint the group of tenants in question? That has been answered by what I have said about the proposed corporation.
I hope, therefore, that my Amendment meets all the objections which the Government have been able to scrape up. It is a reasonable proposal. It relates to an area well known to the Government, and it may well apply to other similar areas. I do not know about that, but I have referred to the particular case because it is of some importance, covering many thousands of houses. If the Government will not accept the Amendment in terms, I hope that they will at least give a firm promise that they will deal with the matter when the Bill goes to another place.
§ Mr. Moyle
The hon. Member for Hendon, South (Sir H. Lucas-Tooth) advanced some compelling arguments in favour of the Amendment, and I would not like my right hon. Friend to think that support for it comes only from the benches opposite. It gives me great pleasure to say that, at this late stage in our deliberations, this is the first Amendment coming from the party opposite which I consider to be wholly attractive, greatly to be welcomed, and for the benefit of lessees.
We all want to preserve, as far as possible, the well managed estates. This is 1605 not in issue. The concept of a scheme of management is an excellent one, which can be developed, but, with respect to my right hon. Friend, we have not got it right yet. The trouble with the Clause unamended is that, as the hon. Member for Hendon, South pointed out, the initiative lies entirely with the landlord. Here, I must record, with some surprise, my agreement with certain points made by the hon. Member for Crosby (Mr. Graham Page). If there is a large move towards enfranchisement on well-managed estates, the landlord will not be interested in taking on the powers of management which the Clause as drafted provides for, and I suspect that it is the difficulties in this connection which have driven my right hon. Friend to use such vague and rather dangerous concepts as the regulation of the redevelopment of an estate. If he accepted the Amendment now proposed, my right hon. Friend could, very largely, drop that dangerous concept, which has caused my hon. Friends and me such concern.
We all know what the Government's objections are, but I urge them to accept that this is an occasion when they should be bold. I have had some experience as an estate director in running well-managed estates, as they have been called, and, in my experience, the real drive towards the maintenance of such estates comes not from the services provided by the landlord in the maintenance of the amenities as such. The real power behind the preservation of these estates is the desire of the individual tenant to maintain and enhance the value of his property. That should be recognised and developed. The hon. Member for Hendon, South has indicated how we may do that, and we should be grateful to him.
The real snag with getting the tenants to take the initiative in maintaining the well-managed estate is that they are a rather large and disparate body. One must get over the initial hurdle of organising them. When attempts are made to do this there is no doubt that there is always the odd awkward tenant. There is always the odd tenant who tries to hold back, and although he pretends to do so on principle it may be that the scheme has been promoted at a time of temporary financial embarrassment for his family.
1606 Only the gentlest pressures are required to bring the tenants together. Once the initial hurdle is over they are perfectly capable of running a first-class scheme for the preservation of a well-managed estate. The Amendment provides a suitable framework for so doing. I should like wording covering a body which is set up after the Act comes into force and which does not just apply to a body that is already in existence when it comes into force.
I said that the gentlest of outside pressures were required to get a scheme of this sort going. Perhaps the Ministry of Housing and Local Government is not at present equipped to exert that sort of pressure. It has been suggested to me that my right hon. Friend the Minister might care to create some sort of national body with the responsibility for pomoting organisation among the tenants, and organising negotiations between those who wish to enfranchise and the landlord. I should like to have the Minister's comments on that.
Subsection (7) provides for the rights of the landlord to be taken over either by the local authority or by any other suitable body. I have always read that as meaning a committee of the tenants of the estate. But it may well be that the wording is loose enough to cover something like the national commission or committee to which I have refered. I should be grateful if the Minister could tell me about that.
§ Mr. S. C. Silkin
I too am grateful to the hon. Member for Hendon, South (Sir H. Lucas-Tooth) for moving the Amendment, which is in principle identical to that which I moved in Committee. If he looks again at that Amendment and the Clause he will see that we are not even at issue over the question of local authorities, because I was merely repeating what appeared in subsection (7) and transferring it to new circumstances.
I am not so pessimistic as the hon. Gentleman about what the freeholders of the estates are likely to do. I was rather encouraged in my greater optimism by hearing my right hon. Friend say earlier this evening that he had been approached by the freeholders of some of the large estates, and that it was as a result of that approach that he revised the wording of Clause 19. That seems to show that they are sufficiently interested in Clause 1607 19 at any rate to want him to alter its terms in a way which would presumably be more likely to encourage their interest.
It would be wrong to assume that the process of enfranchisement on the large estates will be very rapid. It is bound to take a number of years, and I cannot see why any estate owner should be prepared in the transitional period to relax the control he now enjoys, which can only affect his land values in the course of the period of enfranchisement. None the less, one must cater for the sort of cases where the freeholder would not take the steps under Clause 19. It is for this purpose that the hon. Gentleman has moved his Amendment and it seems to me to be valuable.
§ Sir H. Lucas-Tooth
The hon. and learned Gentleman has made what appears to be the valid point that the landlord will wish to preserve the value of his land. However, as he will never receive the reversion, because it will always be snatched away from him as it is becoming due, that argument is unreal. He has to manage the estate with a tenant sitting there. He cannot let or increase the rents, so he will have no inducement to take on the responsibility for those who enfranchise.
§ Mr. Silkin
I do not agree with the hon. Gentleman. As I am agreeing with the Amendment, perhaps we ought not to spend time dealing with this in detail.
What the landlord will obtain by way of redevelopment value must depend on whether the estate, at the time when enfranchisement takes place, is in good or bad condition.
Be that as it may, this is a valuable provision. I should like to see this sort of principle, which is what one might call a housing association or housing society principle, extended much further than merely to estates which are at present leasehold and which will become freehold. I regard it as a very valuable experiment which, if successful, as I believe it will be, can be applied much more generally in urban areas and can be capable of creating residential communities in the true sense of the term.
§ Mr. Skeffington
The hon. Member for Hendon, South (Sir H. Lucas-Tooth) recalled that in Committee I was sym- 1608 pathetic to the case put by my hon. and learned Friend the Member for Dulwich (Mr. S. C. Silkin). I am glad to report that my right hon. Friend is still very sympathetic to this principle and, even at this late stage, would like to take any practical step he can to meet it. That was and still is the position, but there were certain difficulties.
I am sorry that the hon. Gentleman used the words "scraped up objections". When one has sympathy one does not care to find obstacles to prevent one from carrying out what one would like to achieve. Certainly on broad democratic principles of self-government, if it is possible to get a body that could discharge this task, it would be ideal. In theory and in practice a body of residents who cared about the estate and area in which they lived would be the ideal body to undertake a scheme and to see that its provisions were enforced.
There are difficulties, however, which I must mention again. I realise that the hon. Gentleman is speaking very largely with a particular estate in mind where some of the difficulties which I mentioned in Committee are not likely to arise in such a severe form. If the composition and constitution of the body is regulated by a private Act of Parliament then many of the difficulties would not arise with the estate which he has in mind.
However, the Amendment would also relate to other areas, and the Minister would have to be satisfied that the body sufficiently represented the interests of the tenants and had been so constituted as properly to be able to perform the functions of the subsection. A heavy responsibility would rest on the Minister to see that it was done properly. I am not sure about the sort of machinery which would be required, but it would obviously involve some fairly comprehensive inquiries. I mention these things not because I want to defeat the object of the Amendment, but in order to show that there are practical administrative difficulties.
We all know how committees are sometimes elected—although not in the area which the hon. Gentleman represents—and that is a difficulty which any Government would want to regard as satisfactorily solved before embarking on this sort of solution. Even if one got over that difficulty—and I said in Standing 1609 Committee that it was not beyond the wit of man to devise ways in which to do that—there would still be the fact that it would be difficult, if not impossible, for a group of tenants to hold up enfranchisement. I do not mean that it would be wrong for a group to do so, but there would be interference with the fundamental rights of the freeholder.
There is nothing in the Amendment to prevent the owner of the freehold from disposing of it at any time, whether or not a group of tenants was in being or in process of being formed. There would be some estates where some tenants would want to get on with their enfranchisement and there would be nothing to prevent the freeholder from disposing of the freehold while the scheme was being set in being, even if the court could stop the disposal of freeholds after that time, although I am not certain of the full legal effects of the Amendment.
However, I share the belief that in a number of cases the leaseholders will want to operate schemes and that with leases of 999 years, there is some inducement for the freeholder to maintain the estate in the best possible condition. My right hon. Friend has been impressed by the argument here, in Committee and elsewhere. He very much believes in this form of control and he would like to consider the matter further. He cannot accept the Amendment and it is impossible for him to do anything immediately, but certainly the door is not closed and if it is practicable to add a provision to the Bill to provide for what the hon. Gentleman has in mind, my right hon. Friend would very much like to do so.
If the group of whom the hon. Gentleman has spoken would like to discuss any matters with my right hon. Friend, even at this stage, he would be happy for the hon. Gentleman to bring it to see him. I cannot advise the House to accept the Amendment, but my right hon. Friend is still very sympathetic and if it is possible in any way to meet the point, he will do so.
§ Sir H. Lucas-Tooth
In view of the hon. Gentleman's generous offer, I beg to ask leave to withdraw the Amendment.
§ Amendment, by leave, withdrawn.