§ 5.12 p.m.
§ Report received.
§ Clause 1 [Disposal of crofting property]:
Lord Sewel moved Amendment No. 1:
Page 1, line 25, at end insert—
("() Any disposal of property under this Act shall only include normal maintenance burdens and obligations, and shall exclude major infrastructure in and related to the crofting community affected by the disposal.").
§ The noble Lord said: My Lords, in moving this amendment, I preface my remarks by saying that I believe that the procedure that we have adopted in considering this Bill has been wholly beneficial. We had the advantage of the Select Committee's visit to Inverness where we took a great deal of valuable, informed and detailed evidence. We also had the opportunity of visiting Skye, where we were able to see many of the particular problems and to have illustrated to us many of the concerns facing crofters in the north-west of Scotland.1471
§ I wish to stress that we have also had the opportunity of having a very constructive Committee stage in the Moses Room. Putting it all together, for at least some Members of the Select Committee it has been an educative experience. We reach the Report stage where really no great issues of principle and no major matters of policy divide us. Indeed, having read the Hansard report of the Committee stage proceedings, I believe that many of us are happy to accept many of the policy clarifications that the noble Earl was able to give then.
§ However, there still remains a difference in approach. It is fair to say that the Government are intent on keeping the Bill relatively undefined in a number of areas in order to maintain flexibility. Flexibility is a good thing, but there is a risk, which is that because of the lack of clarity and certainty, those who may wish to proceed and to take advantage of the measures contained in the Bill will somehow be deterred. They will not have sufficient information to know where they stand at the initial stage. That is an omission.
§ Through virtually all the amendments tabled today we seek to add a degree of certainty and clarity to the Bill. We do not seek to change in any way the direction of the Bill or the main policy underpinning it. But there is an argument for a greater degree of precision. That is particularly the case with Amendment No. 1, which deals with the problem of burdens. In a number of cases, the burdens that particularly fall on crofting estates are of significance. The noble Earl the Minister indicated Benbecula, where there is a major drainage scheme. In other crofting estates there are responsibilities for major roads and bridges.
§ Clearly, if these burdens are transferred then at some time in the future, following something like a flood or a landslip, the crofting trust that has been established in all goodwill on the basis of viability at that time, will find itself faced with an intolerable burden, which will drive the trust out of viability. It is our proposition that it ought to be made clear from the outset that the burdens to be transferred should only be the normal ones of maintenance that one would expect in keeping up the property and that the exceptional and major burdens relating to infrastructure provision should not transfer at the time.
§ I recognise that the Minister at Committee stage in the Moses Room indicated that that was likely government policy. If that is the case, there would be great merit in trying to make that clear in the Bill itself so that this quite significant worry and concern is removed from those who wish to take advantage of its provisions. In trying to put into the Bill virtually the words that the Minister himself used at Committee stage, I hope that we shall get that degree of certainty. I hope that the Minister will be able to respond positively to this amendment. I beg to move.
§ The Earl of Mar and Kellie
My Lords, I agree entirely with the noble Lord, Lord Sewel, about the arrangements for the scrutiny of this Bill. I believe that the Select Committee visiting Skye, Inverness and the procedure in the Moses Room were particularly helpful.
1472 As regards the amendment, we have to make certain that we are talking about public assets rather than estate infrastructure. I believe that we can see that division. Therefore, we are probably talking about tracks and bridges, drains and fences as being estate infrastructure and the possibility of public roads and bridges have somehow or other crept on to the estate, but which have not yet been adopted by the local authority.
I certainly approve of the philosophy involved in the purpose of the amendment. Perhaps the words "normal", "major" and "crofting community" are still slightly undefined. I do not believe that that matters because it certainly explains the approach that should be taken in the negotiations between a group of crofters seeking to take over their estate and the negotiating team from the Scottish Office. It is probably just as well that there is imprecision in words like "normal maintenance", "major infrastructure" and "crofting community". I agree with this amendment and hope that it will commend itself to the noble Earl.
The Earl of Balfour
My Lords, I speak to this amendment as an ordinary person who looks after a fairly small estate in Scotland where the drainage was put in probably 200 years ago. The best way to go about this would be to insert into the Bill a provision to allow the new owners of the land to be eligible for a grant. Perhaps I may give your Lordships one example. If one replaces lead water pipes from the mains to the first tap in the house—pipes which are starting to leak because of their age—at present one is eligible for a 75 per cent. grant. Such a grant is important and applies whether or not the house is privately owned or rented. On average, such work costs about £1,000 per house. Most of us can afford to spend £250 but simply do not have the money to spend £1,000.
The Earl of Lindsay
My Lords, like the noble Earl, Lord Mar and Kellie, I should like to associate myself with the remarks made by the noble Lord, Lord Sewel, about the advantages derived from the procedure we have adopted with this Bill.
The noble Lord also suggested that despite great proximity on many of these issues, there was perhaps some difference of approach between us in that the Government are seeking to keep the face of the Bill non-prescriptive in terms of exactly how the transactions may progress. We see that as producing the necessary flexibility. However, the noble Lord fears that that may deter applicants from coming forward.
I acknowledge that the issue needs to be pondered carefully, but we have thought this through and we have a greater fear that if we pre-empt and fetter (by cluttering the face of the Bill with prescription) there is a danger that that inflexibility may deter crofting townships and crofters from coming forward. Therefore, I understand exactly the point which the noble Lord explored but, as I have said, we have thought about this carefully. We realise that clarity and some confidence about what is likely to be the result of the Bill are useful in encouraging people to come forward, but I hope that the assurances that I have been able to give to date in Committee and again today on Report will make clear 1473 the policy that would underlie the Government's position in any transaction between the Secretary of State and the crofting townships. I remind the House that the Scottish Office and the Secretary of State are willing sellers. The Government have introduced this initiative because they want to see the transfer of townships into crofting trusts.
To pick up on a point made by the noble Lord, Lord Sewel, we are also determined that any such transfer should be to a viable successor body. We see no merit whatsoever in a transfer to a body which either immediately or within a fairly short timeframe might lack viability.
This amendment seeks to ensure that only normal maintenance burdens and responsibilities are transferred to crofting trusts and that the Secretary of State retains any responsibility he has for wider community assets. Noble Lords will recall that we discussed this at some length in Committee. I am grateful for all the contributions made in Committee and again today by the noble Earl, Lord Mar and Kellie, and my noble friend Lord Balfour. I made it clear then that, although it would be appropriate for crofting trusts to take on the normal maintenance and repair responsibilities that go with ownership of an estate, the Government would retain any responsibility that they have for maintaining assets which have a wider community purpose. I am very happy to reiterate and underline that reassurance again today.
I appreciate that in proposing the amendment the noble Lord is simply trying to reflect that commitment on the face of the Bill. He said that he took some inspiration from my words in Committee. I understand the reasons behind the amendment and I stress that in the minds of some there is a fear that other governments may not be as sympathetic as this one to the transfer of the Secretary of State's estate to townships.
Nevertheless, I suggest that the amendment is both unnecessary and conceivably dangerous. The whole purpose of the Bill is to provide a flexible vehicle to allow for the transfer of the Secretary of State's crofting estates to crofting trusts. Noble Lords opposite have tried on a number of occasions to chip away at that by proposing amendments which would have the effect of constraining the Secretary of State or the trust. In other words, they would potentially constrain that flexibility.
I understand the motives—and they are the best of motives—but we feel that that is unnecessary. The disposal will be agreed between the parties. It will not be imposed on anyone. We have made it clear that the disposal would take place only if the crofting township or the crofting trust involved actually wanted and approved the terms of the transfer. The negotiations would be freely entered into by the crofting trust.
I think the amendment is potentially dangerous because we simply do not know what legal interpretation might be put on the key terms in the amendment, "normal maintenance and burdens and obligations", and, "major infrastructure in and related to the crofting community", in the future. We might find, for example, that because of the way the terms were interpreted, the Government were required to transfer some burden which they would have 1474 otherwise retained and that this decision was critical to the viability of the trust. I know what the noble Lord has in mind, but if the amendment were to become enshrined in legislation, those words would be looked at closely and we would no longer have the ability to explore every single possibility with the prospective trusts.
We should keep the Bill as flexible as possible. The House has my assurance on the general approach of the Government to this matter. I remain convinced that the best way forward is for each estate to be considered separately in the light of those principles. I hope that with that reassurance and explanation the noble Lord will feel able to withdraw his amendment.
§ Lord Sewel
My Lords, I thank the Minister for his reply. He has gone most of the way to satisfying the concerns felt on this issue not only by noble Lords on these Benches but by all who served on the Select Committee. The noble Earl has spelt out the terms under which the Government would seek to exercise the disposal, with particular reference to the burdens. Given those assurances, I am happy to beg leave to withdraw the amendment.
§ Amendment, by leave, withdrawn.
Lord Sewel moved Amendment No. 2:
Page 1, line 25, at end insert—
("() In any disposal of property under this Act no value shall be attributed to the land.").
§ The noble Lord said: My Lords, in moving Amendment No. 2, I should like to speak also to Amendment No. 3 which is grouped with it. Together they seek to define the terms under which the disposal of both the land and the rights appertaining to that land should be transferred. Their objective is to ensure that the transfer of both the land and any rights takes place basically on a no value, no cost basis; and that the trust when set up enjoys without cost the full benefit of the land and any rights associated with it.
§ The Minister has, with credit, frequently indicated that the intention of the Government is that any property is transferred on the basis that the viability of the trusts set up is assured. The difficulty is that viability can be a very narrowly drawn concept. I suppose that if expenditure is 20s a year and income is 19s 6d that is viability. I am sorry; that is the opposite of viability. If expenditure is 19s 6d a year and income is £1 that is viability. That slip makes the point that the judgment as to whether or not something is viable is finely balanced. This may put too great a pressure on trusts if they are to flourish. We seek to ensure a basis of transfer that leads to a situation where trusts do not struggle to survive but flourish. To secure that, we want the transfer to take place on a no cost no value basis.
§ I accept the point made by the Minister in Committee that there is a distinction between the west coast crofts which predominantly have common grazings and east coast crofts which are effectively small farms. It is arguable that the basis of transfer may be different in those two situations. However, if one is to have a general approach surely it must be one that enables the 1475 crofting trusts to have the best opportunity of success and everything enables them to flourish. Amendments Nos. 2 and 3 seek to ensure that.
§ The danger of "viability" is that it can be a very closely and narrowly defined concept. If the trust has the good fortune to have land on which there are rights—the main ones are mineral rights—let it have those rights and exploit them for the local benefit. One is not talking about enormous sums of money. For example, it was made clear that currently the total income from the Secretary of State's entire crofting estate from mineral rights was £17,000. Why do we not have the generosity to say that in order for local potential gains to accrue those rights should be transferred free of charge to the trusts that are set up?
§ 5.30 p.m.
§ The Earl of Mar and Kellie
My Lords, this amendment sets off in the right direction. I believe that the key word is "land". The crofters deserve the right to this land because they created it as agricultural land. When we went to Skye we visited the North Talisker estate. Before it was purchased by the Board of Agriculture for Scotland in 1926 it had been a sheep farm. In 1883 the value of that sheep farm was £1,575 a year. I suggest that that exceeds the rent that is currently taken from the 70 crofters on that land. I am very much in favour of the transfer of the land which effectively has been created. It is possible that on some estates there are jetties, fish-processing plants, car parks or even helipads. Perhaps those kinds of infrastructure need to be sold and cannot just be regarded as part of the land, in the sense that there will have been substantial investment by the landlord rather than the tenants who will have brought the land under control.
Referring to Amendment No. 3, I note that, although the wordsat no costs to the transfereesound impressive, earlier in the provision there is reference tomay agree with the body acquiring the propertywhich perpetuates the philosophy adopted in the first amendment.
The Earl of Lindsay
My Lords, as with the first amendment, I do not believe there is very much between us on Amendment No. 2. Perhaps the difference lies in the packaging rather than the destination that all noble Lords involved in this Bill seek. Amendment No. 2 moved by the noble Lord, Lord Sewel, would require the Secretary of State to transfer the lands in his crofting estates free of charge. Amendment No. 3 would require that any associated mineral, sporting or other rights should also be transferred free of charge. We discussed both of these propositions at some length in Committee. Nonetheless, it may assist if I reiterate the Government's position. The noble Lord, Lord Sewel, stressed our objective of achieving viable trusts. I prefer his second definition of viability to his first. The first smacks of Labour Party mathematics but the second is something to which the Government can certainly sign up.
1476 The Government expect that the vast majority of land on the Secretary of State's estate will be transferred free of charge. This is in line with the commitment made by my right honourable friend the Secretary of State that the Government are willing to consider a transfer at no consideration where this is necessary to ensure the viability of a trust. I agree with the noble Lord, Lord Sewel, that the judgment of viability can be a fine science, but we would encourage any prospective crofting trust to seek as much advice as it believes it ought to seek in order to have confidence to go ahead with any purchase or the receipt of any transfer. We hope that the best advice will be available to them and that they will not seek to jump to any conclusions without help. Nevertheless, there will be exceptions where free transfer is either not necessary or is not in the public interest.
During the debate in Committee my noble friend Lord Gray quite properly reminded us that public money had been used to support crofting and that the public interest should be taken into account and could not be abandoned. I also emphasise the public interest in these circumstances. Given land values in the Highlands and Islands which reflect differences in land quality, I believe it is much more likely that we will look for some consideration for those estates that comprise individual crofts without common grazings in the eastern Highlands. At the moment the crofters on these estates can buy all of their land under the existing right to buy provisions based on the statutory formula of 15 times the annual rental value. As I said in Committee, it would be wrong for the provisions of the Bill to be used to allow crofters to circumvent the existing right to buy. It would also be unfair to those crofters who had already bought and to those tenants buying farms on lowland estates who had to make some payment to buy their land.
I acknowledge that the noble Lord, Lord Sewel, accepted in Committee that we had a genuine point in anticipating that proposed transfers could legitimately and equitably distinguish between, on the one hand, west coast estates with common grazings and lowland values and, on the other hand, certain east coast estates with no common grazings and higher land values.
The proposed amendments would not, however, allow us to take this distinction into account or indeed other factors which might exceptionally suggest that the public interest should and could be taken into account. This would only be relevant, however, where any consideration being made for the value of the land did not threaten the viability of the future of the new crofting trust. In other words, any consideration has to be affordable to that new trust. It would be fair not only to the crofters concerned but to the public.
Amendment No. 3 deals with the rights attaching to the land. Since sporting rights run with the land, we are, for the most part, concerned here with mineral rights. We do not, in principle, want to retain mineral rights where the Secretary of State is transferring land to a trust. Indeed, an overriding intention to do so on our part would be contrary to the spirit of the Secretary of 1477 State's crofting initiative. Nor can we disregard any public interest. To do that would be contrary to a fundamental duty of government.
As with my response to Amendment No. 2, what we would seek would be flexibility and fairness to reconcile the specific circumstances with the respective interests of a crofting trust and the public interest. Each case would need to be looked at by both parties on its merits, but if trusts wish to acquire mineral rights, which we would welcome, then the public interest would normally require that a valuation be agreed and a charge negotiated.
The Secretary of State holds mineral rights over some 27 of his 53 crofting estates. As the noble Lord, Lord Sewel, has reminded us, the total annual income arising from these rights is currently in the region of just £17,000. In many cases, therefore, the appropriate charge for the freehold transfer of mineral rights would indeed be very modest.
However, as the noble Lord, Lord Macaulay, has reminded us in the past, with mineral rights there is always the potential for substantial or excessive windfall gains, and we need to consider such an eventuality with very great care. There might therefore be cases where only a modest charge would be appropriate, but it should be linked to a clawback provision which protected the public interest in the event of a substantial or excessive windfall gain. In addition, and again depending upon the circumstances, it might not be unfair to the public interest if any such clawbacks were time-limited. This sets out our presumption that mineral rights would, wherever possible, be included in a transfer of assets to a new crofting trust.
I have also described the flexibility that would be a feature of any such transfer so that we are fair not only to crofters and their circumstances and aspirations, but also to the taxpayer, who underwrote the purchase of those rights many decades ago and who has invested considerable sums in the maintenance of the estates ever since.
Suppose, however, that a prospective crofting trust was not, initially at any rate, able or willing to assume the relevant mineral rights. In those circumstances it would be wrong to seek to compel trusts, which is what would happen with this amendment.
Once again, we are determined that there be sufficient flexibility so that, without abandoning the public interest, the presumption can be that the crofting trust will normally be the principal beneficiary of the income arising. Therefore, to use the words of the noble Lord, Lord Sewel, I agree, let them exploit those rights for local benefit. I alluded to that possibility in Committee. The trusts, as surface proprietor, would be able to benefit from income while the department retained the mineral rights. Whatever the arrangements which are agreed, they must be fair to both parties, the trust and the public, whose money was used to acquire the estates and to support them over the past decades.
I trust I have explained the Government's position. The mandatory free transfer of land and related assets regardless of the circumstances would be wrong in principle and it would be in danger of creating 1478 anomalies and loopholes in practice. We have, nevertheless, made it absolutely clear that, through the flexibility that this Bill provides, our intention is to be as generous and supportive as possible to the future crofting trusts without riding roughshod and indefensibly over the legitimate interests of the taxpayer.
I hope that the noble Lord finds reassurance in the explanation I have given and is able to withdraw his amendment.
§ 5.45 p.m.
§ Lord Sewel
My Lords, again I thank the Minister for his comments. I am particularly grateful that the noble Earl, in speaking on behalf of the Government, appears to be converted to the idea of a windfall tax. It is something to remark upon.
On the basis of what the Minister has said, I am content to withdraw the amendment, but I hope that, in approaching the individual negotiations, where there is an element of doubt the benefit of doubt will be given to the crofting trust and that the Government—any government—will act with a degree of generosity which will at least underpin the potential for the success of the trusts once they are created. I beg leave to withdraw the amendment.
§ Amendment, by leave, withdrawn.
§ [Amendment No. 3 not moved.]
§ Clause 2 [Restrictions on disposal]:
Lord Sewel moved Amendment No. 4:
Page 2, line 19, after ("community") insert ("and local community development").
§ The noble Lord said: My Lords, this group of amendments seeks to build into the consultative process which the Crofters Commission will undertake the concept of local community development. That is singularly appropriate because the objective of the Bill must be to strengthen community development in sparsely populated areas of Scotland, which are nearly as sparsely populated as this House.
§ When we discussed this in Committee the point was made that indeed the Crofters Commission could, if they thought it appropriate, take into account local community development and the way in which a potential trust would add to the achievement of local community development. However, in fact, there is a case for the Bill to be much stronger because the whole purpose of local community development is so central to the concept in the first place.
§ It would be remiss if the Bill did not actually specify the need for local community development and the extent to which a transfer would enhance the potential and possibility of local community development, if that was somehow left to one side or left to the possibility that the Crofters Commission, in undertaking their consultations, did not take that into account.
§ I see no objection as to why, in setting up the consultations, in reaching a view on which to advise the Secretary of State, the Crofters Commission should not take this central issue on board. It is a central issue; it is the way in which these trusts can in fact 1479 make a significant contribution—I hope that they do make a significant contribution—to the future economic and social well-being of the Highlands and Islands of Scotland. Indeed, that type of approach sits very well with the Government's own rural White Paper, and I would have thought that the emphasis that the inclusion of these words in the Bill would give to the value to be placed on encouraging local community development is wholly beneficial. I do not believe that it should be left as something that the Crofters Commission could or may take into account. They should be required to take it into account as perhaps the most important single factor in deciding the basis of their advice to the Secretary of State. I beg to move.
§ The Earl of Mar and Kellie
My Lords, with regard to one of these amendments, I have to say that at the present moment local community development is not an activity with which the Crofters Commission is required to deal. Indeed, it is probably not legally entitled to do it. It strikes me that it would probably be treading on the toes of Highlands and Islands Enterprise, the local enterprise companies and possibly even on the toes of the local authority.
This is social and economic activity which the Crofters Commission ought to be doing, and I believe that the commission would like to start taking this approach to its work.
It is important to recognise that crofters now typically gain 10 per cent. of their income from crofting and 90 per cent. from what are quaintly known in crofting legislation as their auxiliary occupations. The move from subsistence agriculture to crofting becoming a population holding measure is a good one. It is important to encourage people to go to the remoter areas to make a life for themselves using repayable loans and the spare time activities which crofting constitutes. I suspect that we are looking at something which the Irish have solved by having a Department of the Gaeltacht to handle such problems. I commend the amendment to the Minister.
§ Baroness Carnegy of Lour
My Lords, before my noble friend replies, I was unable to take part in the Committee stage because I was listening to a debate in the Chamber. I was not on the Select Committee, but I have been listening to the discussions with great interest. Will my noble friend indicate whether the Government are against crofting trusts becoming entrepreneurial and doing good things on their crofts? I was a little dismayed by the discussion about minerals. I imagine that the Bill as it stands does not prevent crofters exploiting minerals. They might discover barites on the land, or something like that. I understand that the Government do not want to put that on the face of the Bill, but surely the whole idea is not to keep crofters where they are and to prevent them developing their crofts in any way they want; the idea is to put the crofts into the crofters' hands for the good of the crofts, the crofters and the Highlands of Scotland.
Although I shall understand if my noble friend does not want to tie things down too much by putting them on the face of the Bill, it would be interesting to hear 1480 from him—perhaps I should know—whether there is anything wrong with crofters becoming entrepreneurial and not just maintaining the status quo.
The Earl of Lindsay
My Lords, I am grateful to my noble friend for her intervention. She has articulated the objectives behind the Bill as well as anyone has done to date. We want the Bill to enable crofters to take a greater stake in their own futures, shape their own destinies, to be as entrepreneurial as they want and to develop the social, cultural, economic and environmental aspects of their communities. The hope of my right honourable friend the Secretary of State is that the transfer of the land and any other assets associated with that transfer will provide a springboard for those crofting communities to take hold of the direction in which those communities subsequently go. I have explained at great length that we are seeking to keep the face of the Bill as uncluttered as possible.
The Secretary of State has brought forward the Bill to encourage crofters to take on the management of their own estates. Crofters can progress as freely as possible. Any reservations that my noble friend might have are entirely misplaced. We are seeking to give crofters control.
The amendment encapsulates a sentiment with which we have a great deal of sympathy. If noble Lords look at Clause 2 they will see phrases such as:crofting interests in the property …the promotion of the interests of persons residing on such property … the general interests of the crofting community in the district … the views of crofters in that district; and any other matter which they consider to be relevant".The concept of local community development lies at the heart of the Bill. I emphasised in Committee the important part that community development will play in the realities that will stem from the Bill becoming law. The Bill's drafting makes the amendments unnecessary. They could conceivably be restrictive.
I shall deal with the first point. The Bill already allows the Crofters Commission to have regard to community development, both when it considers the general interests of the crofting community and with regard to any other matter which it considers to be relevant. I drew attention to the current drafting because I cannot conceive that the Crofters Commission would not address a potential for local community development when it goes through the various duties that the Bill imposes upon it.
The noble Earl, Lord Mar and Kellie, suggested that with the existence of Highlands and Islands Enterprise and the local enterprise companies, the Crofters Commission might feel constrained in addressing local community development, especially if it is economic. That is not the case. Within the duties defined by the Bill, the Crofters Commission will be advising the Secretary of State on the single transfer of a particular holding to a crofting trust. I do not anticipate any difficulty with that duty and the duties of the enterprise network.
There is also the risk that the amendments would have an unfortunate restrictive effect. I acknowledge that that is not intended by the noble Lord, Lord Sewel. It is possible that some communities will seek to establish 1481 crofting trusts to allow them to maintain, as nearly as possible, their current situation. In those or similar conditions we would not wish the commission to see itself as being under any statutory duty to recommend against such proposals just because they were inadequately concerned with community development, however that might be interpreted.
We consider that a possibility. It is not one which we would like to see become a reality. The term "local community" may be uncertain. The local community would include more than just the residents on the property to be disposed of. That is the purpose of Clause 2(2). It is quite proper that the commission should have regard to the development of the wider community, but such development which goes beyond the land and members of a crofting trust cannot be of such importance that the commission should be required to give it preferential attention. That is why Clause 2 is structured as it is, with subsection (1) giving preference to the interests of those residing on the property while subsection (2) takes a broader look.
The Bill will allow the commission to give due regard to local community development, whether that development be economic or cultural, whether it involves an increasing population or improves circumstances for an existing population. I understand the sentiment behind the amendment but we see difficulties with the drafting proposed by the noble Lord, Lord Sewel.
§ Lord Sewel
My Lords, I again thank the Minister. I am more disappointed in his response on this occasion than on previous occasions. If on the one hand the Minister believes it to be inconceivable that the Crofters Commission should not take into account matters of local community development, I see no argument against requiring it, and making it clear that it should take into account the local community development effect of the transfer and the setting up of a trust.
The argument that it could be potentially restrictive is a non-starter. The amendment seeks merely to require the Crofters Commission to take this into account among a number of other factors. Having taken it into account in the particular circumstances which the noble Earl indicated, it may well seek to advise the Secretary of State that in a particular case, the local community development factor should not be dominant. That would be fair enough. But in reaching its view, it is essential that the local community development effect of a transfer should be something which it should at least be required to think about, consider and reach a view upon. As I say, I am disappointed that the Minister cannot go further on this particular issue. I beg leave to withdraw the amendment.
§ Amendment, by leave, withdrawn.
§ [Amendment No. 5 not moved.]
§ 6 p.m.
Lord Sewel moved Amendment No. 6:
Page 2. line 22. at end insert—
("() Any subsequent conveyance from a transferee to a new owner of property disposed of under subsection (2) above shall require the consent of the Commission.").
§ The noble Lord said: My Lords, Amendment No. 6 returns to a difficult issue which took up a great deal of our time, thoughts and energies in Inverness; namely, the problem of on-selling. Perhaps I may explain my anxiety. A transfer takes place and I accept what the Minister has said that it takes place on a basis of generosity and viability and a healthy trust is established.
§ The difficulty then comes with what happens next or what potentially could happen next. The danger that is seen by at least some of those involved actively in the crofting community is that the intentions of the Bill could be undermined if there is a danger of significant on-selling of the land which formed part of the original transfer.
§ In many cases, it may be thought that that is not a very real threat. But there are some examples. I shall not use the expression "white settlers" because I prefer to use the phrase "heavy housing development pressures". In some parts of the Highlands, particularly outside the presently established towns and villages, it is clear that there is a very heavy demand for housing plots and developments.
§ There is a danger involved here. There are indications that that danger is becoming a reality, albeit on a relatively small scale at the moment. As I understand it, in the case of one of the already established trusts—Assynt—in order to achieve the income to maintain its current activities, it has sold some of the capital assets; namely, the land. Over a period of time, the whole basis forward of the trusts could be eroded significantly if there is that incremental selling on of the land which formed the basis of the whole development.
§ The Minister in his comments quite rightly drew attention to the role of the Scottish Land Court. It is fair for him to do so. In placing this amendment before the House, we are seeking to give him an opportunity to underline the degree of control and guarantee which the Scottish Land Court will be able to exercise to ensure that the erosion of the viability of the trusts which have been established is not put into jeopardy. I beg to move.
The Earl of Lindsay
My Lords, I am grateful to the noble Lord, Lord Sewel, for giving me an important opportunity to restate an assurance on this vital matter.
The amendment proposes an insertion into Clause 2(2) which deals with the matters to which the Crofters Commission should have regard when advising the Secretary of State in relation to a proposed transfer of land from himself to a crofting trust. I believe that it was intended to introduce an amendment which would require a crofting trust which wished to sell or otherwise dispose of any of the land transferred to it by the Secretary of State to obtain the consent of the commission.
However, the issue which the noble Lord, Lord Sewel, raises is in relation to selling on. We have never stated that crofting estates are free from threats, pressures or an erosion of the current patterns by which their lives are guided. However, as I explained, we believe that there are sufficient safeguards to protect crofting land.
1483 Land in crofting tenure is protected by the Crofters (Scotland) Act 1993 which requires any landlord wishing to take land out of crofting tenure, which is known as "resumption" to obtain the approval of the Scottish Land Court. Before authorising the resumption, the Land Court must be satisfied that the landlord wishes to resume the land for some reasonable purpose in relation to the,good of the croft or of the estate or of the public interest".In addition, "reasonable purpose" is also further defined and may include, among other things, the building of dwellings, schools, halls or community centres.
I hope that is the assurance which the noble Lord seeks. It is an important assurance which I am happy to give and I am glad that it should go on the record. We could not agree to the imposition of an additional or unnecessary hurdle on those crofting trusts which have assumed land that originated on the Secretary of State's estate, unlike other crofting landlords. We see the discrimination that would create. In a sense, it would create also a separate class of crofting landlord. That would be unjust and unnecessary. However, I am happy to repeat the safeguards which are very important and which the noble Lord, Lord Sewel, suggested should be repeated for the record, and they exist in the 1993 Act.
§ The Earl of Mar and Kellie
My Lords, before the noble Earl sits down, perhaps I may ask whether he agrees that it would be a good idea for the Crofters Commission to scrutinise an incoming new estate owner in the same way that somebody who has purchased his croft has then to apply to become the crofter of it?
The Earl of Lindsay
My Lords, the point that I should make to the noble Earl is that if land was being resumed—in other words, taken out of crofting for a development purpose—then the Scottish Land Court must be satisfied with that resumption; that it is being done for a reasonable purpose; and that the benefits will flow to the crofters, the local community or the public interest.
If the ownership of the crofting land changes hands, that crofting land remains as crofting land and remains within the protection and security which exists to look after all crofting land in successive pieces of legislation. Therefore, a change of ownership should not increase the threat which might be posed to land which remains in crofting.
§ Lord Sewel
My Lords, I thank the Minister again for his comments. I take heart from the fact that the noble Earl spelt out yet again the view that he takes and the assurance that he gives as regards the role of the Scottish Land Court in that regard. However, it is possible that only practice and experience will provide us with the evidence. I have a nagging suspicion that there is a problem here to which we may have to return subsequently, once we see how the operation of the scheme actually beds down in reality. I beg leave to withdraw the amendment.
§ Amendment, by leave, withdrawn.1484
§ Clause 5 [Rights of pre-emption]:
§ The Deputy Speaker (Lord Murton of Lindisfarne)
My Lords, before calling Amendment No. 7, I should point out to the House that if the amendment were to be agreed to I shall not be able to call Amendment No. 8 owing to pre-emption. As it is being debated at the same time, the same applies to Amendment No. 9 which pre-empts Amendment No. 10.
The Earl of Lindsay moved Amendment No. 7:
Page 3, line 1, leave out ("six weeks") and insert ("four months").
§ The noble Earl said: My Lords, in moving the above amendment, I shall speak also to Amendment No. 9. The amendments will extend the period allowed to claimants for compensation in respect of loss of rights of pre-emption from six weeks to four months. I am grateful to various Members of the Committee who queried the original drafting of the Bill on this point, and especially to the noble and learned Lord, Lord Jauncey of Tullichettle, and the noble Lady, Lady Saltoun of Abernethy. I agreed to consider the matter further and I now propose that claimants for compensation should be allowed four months.
§ I would reiterate that the period allowed for the process does not in any way delay the transfer of the Secretary of State's crofting estates to crofting trusts. Indeed, it is only when a transfer has actually taken place that the process of seeking any compensation that might be due for the loss of pre-emptive rights is triggered in the first place.
§ I should also remind the House that the procedure for dealing with claims once they have been lodged is a very fair one for claimants. Where claimants fail to reach agreement with the Secretary of State, they will have a right of appeal to the Scottish Land Court. Proceedings in the land court are straightforward and inexpensive but the court has the power, where it deems it appropriate, to award costs. That should reassure possible claimants and those organisations which might represent their interests. Claims will be dealt with fairly and efficiently.
§ I feel sure that noble Lords will accept that the Government's proposal will allow adequate time to lodge a claim, wherever the claimant may be resident. Amendment No. 9 is consequential upon Amendment No. 7. I beg to move.
§ Lady Saltoun of Abernethy
My Lords, the noble Earl did indeed promise in Committee to produce amendments to extend the six weeks to a longer period. I tabled my amendment only about five minutes before the Minister tabled his. I did so to enable us to talk again about the matter in the event of the Minister not bringing forward such amendments. As it is, I tabled my amendments and asked for a six-month period in the hope that I might achieve three, like a Persian carpet seller. However, I have got more than I even dared hope for. I am most grateful to the noble Earl and shall not, therefore, be moving my amendments.
§ The Earl of Mar and Kellie
My Lords, I do not mean to oppose these amendments but I am still not convinced that we need any time limit for pre-emptors to show up and claim their extinguished right. As the noble Earl said, the pre-emptors' permission does not in any sense get in the way of a successful transfer between the Scottish Office and a group of crofters.
The Earl of Lindsay
My Lords, I am grateful for the welcome given by the noble Lady, Lady Saltoun, to my amendments. I can assure the noble Earl, Lord Mar and Kellie, that we would not seek to impose a time limit unless there was a very good reason for so doing. If there was no time limit and there was a possibility that there might be more than one claimant to pre-emptive rights, it would be impossible to reach a conclusion of negotiations in that, from the Secretary of State's point of view, there might be a need to wait and see whether any other siblings or collateral branches came forward with perhaps a stronger right in law. We must, therefore, impose a time limit to conclude the process. By doing so, we will actually deliver any compensation which might be payable to the just recipient.
§ On Question, amendment agreed to.
§ [Amendment No. 8 not moved.]
§ The Earl of Lindsay moved Amendment No. 9: Page 3, line 6, leave out ("six weeks") and insert ("four months").
§ On Question, amendment agreed to.
§ [Amendment No. 10 not moved.]