Orders of the Day — Dispossessed Tenant Farmers (Compensation)

– in the House of Commons at 12:00 am on 9th March 1966.

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Motion made, and Question proposed, That this House do now adjourn.—[Mrs. Harriet Slater.]

4.48 a.m.

Photo of Mr Robert Maxwell Mr Robert Maxwell , Buckingham

I have sat up all night for an opportunity to raise a very important issue, and I make no apology for doing so. I wish to bring to the notice of the Government the considerable financial hardships caused to compulsorily dispossessed tenant farmers whose land is being taken over for development. I am very grateful to Mr. William Snooks, former National Farmers' Union Bucks County Chairman, and to his colleagues in that branch for drawing my attention to this very great injustice, under which tenant farmers have been suffering for so long.

I wonder whether my hon. Friend the Parliamentary Secretary would consider improving agricultural tenants' compensation. The reasons for my request are, first, that the subject is urgent. Urban development in my constituency of Buckingham and throughout the country is going on at a pace that present legislation never envisaged. Large-scale dispossession of approximately 200 farmers, more than half of whom are tenant farmers, is threatened in my constituency by virtue of the Government's plan to set up a new city to take London's overspill population of about 150,000 people. As is well known, the supply of farming land is limited because dispossessed farmers and horticulturists—who number many thousands all over the country—cannot easily start up again and then only at a very high cost. Hence the need for much better and fairer compensation. The threat to the tenant farmers of my constituency is a nightmare, because they realise that their livelihood and their homes are at stake and that their chance of getting another farm to rent is extremely small.

They feel that the present basis of compensation is both low and diabolically unjust. Present terms of compensation are, in my opinion, mean, niggardly and inhuman. Tenant farmers should receive five years' profits or 10 years' rent, whichever is the higher, when they are compulsorily dispossessed. Farmers would much rather be left alone with their farms. If they have to go, they would rather be compensated by the Government helping to find them an equal-sized farm. If a farmer takes over a derelict farm and makes heavy investments—as in all other businesses—he could and often does lose money in the first two to five years.

By being given the option of five years' profits or 10 years' rent, a farmer could be compensated in a fair way instead of being dispossessed, possibly at a most difficult and disadvantageous time.

The present legislation governing compensation to dispossessed farmers is contained in Section 34 of the principal Act, the Agricultural Holdings Act, 1948, and in Section 22 of a subsidiary Act, the Agriculture (Miscellaneous Provisions) Act, 1963. The principles of compensation are laid down in Section 34 of the principal Act and the maximum and minimum limits are set out. The minimum limit is laid down as one year's rent and the maximum as two years' rent. The rent is the current rent which the tenant farmer pays to his landlord.

No doubt, in 1948, this basis of compensation was fair and reasonable, but time and the value of money have changed. Farming has become big business in which a substantial sum of capital investment is involved. I therefore suggest that the rigid limits laid down in the principal Act have become as out-dated as the penny-farthing in our jet age. There are many aspects of development which affect tenant farmers in my constituency, who until recently have had little cause to fear dispossession or to concern themselves about the compensation to which they might be entitled as a result of their being dispossessed of the land on which they have gained their living.

However, with the threatened setting up of this great new city in my constituency, many of them have had to start concerning themselves with this question, and they are shocked and amazed at how unfairly they would be treated under the present Act. At the moment, the problem of unfair compensation applies most particularly to the tenant farmer, because the dispossessed owner-occupier—of a home, a business or a farm—gets the full market value. Though he may not be able to find another farm, if he is beyond the age at which he is able to find alternative employment, he has at least some capital on which to fall back.

Is it realised that more than 60,000 acres of land are being swallowed up every year by development projects? This is occurring annually, and hardship is being suffered by hundreds of farmers, their farm workers and their dependants. Is it equitable that a young farmer who is making a great contribution to this industry should be penalised on exactly the same basis of compensation as a farmer who is about ready to retire in a year or two? It is very hard on people who are farming as tenants and suddenly find that their land, which is the tool of their trade, is removed from them.

I ask my hon. Friend to consider stating emphatically that compensation should be paid on the basis of five years' loss of profit or 10 years' rent, whichever is higher. I hope that I am not out of order in complaining that the former Administration, who were in power for almost 13 years and who have been pretending to be friends of the farmers, refused to bring in the necessary legislation to put right this gross injustice. For this reason I hope that my right hon. Friend the Minister of Agriculture will honour the pledge which he gave when he said that in principle he accepts that adequate compensation should be given to a farmer who suffered because of the take-over of his land for non-agricultural use. Under the legislation of the previous Administration it was the practice to make ex-gratia payments.

Photo of Sir Samuel Storey Sir Samuel Storey , Stretford

Order. The hon. Member is dealing with legislation. He may not do that on the Adjournment.

Photo of Mr Robert Maxwell Mr Robert Maxwell , Buckingham

I am sorry, Mr. Deputy Speaker. I trust that my right hon. Friend will honour his pledge. I know that my right hon. Friend and this Administration are wholly in sympathy with my plea and agree that something must be done to right this injustice. I believe that the reason it has not yet been done is the need for the Ministry of Agriculture to consult the National Farmers' Union and the Country Landowners' Association, but these consultations have been going on for far too long and the injustice continues.

I hope that my hon. Friend will at least be good enough to say two things this morning—that he is completely in sympathy with my plea and that he hopes that something will be done about this matter speedily; and, secondly, who is the nigger in the woodpile. Is it the N.F.U. or the C.L.A. which is preventing this necessary legislation from being put on the Statute Book? By telling the country which of these two organisations is dragging its feet, at least my hon. Friend will tell the tenant farmers, who are suffering and who have been dispossessed, on whom they should put the blame.

4.58 a.m.

Photo of Mr John Mackie Mr John Mackie , Enfield East

My hon. Friend the Member for Buckingham (Mr. Maxwell) has made an eloquent speech on behalf of his farming constituents and I fully recognise that this question of compensation is bound to cause them concern. Nor is it only a local problem. My right hon. Friend recognises that it is a national problem, since development proposals will inevitably be made elsewhere which will mean loss of land for tenant farmers. My hon. Friend mentioned 60,000 acres, which is a very high figure.

He was right not to apologise for raising the subject at this early hour as it is a very important subject when we consider the number of acres which he mentioned as likely to be taken over, much of which will be occupied by tenant farmers. The reason why compensation is very much in the mind of the farming community is that the Buckinghamshire proposal, affecting an unusual quantity of agricultural land, is under public discussion. We can all see that there will be similar proposals—indeed there are bound to be if the population goes on increasing as fast as we are told that it will.

These large new developments may strike where a few years ago it would have seemed fantastic to suggest that new towns would ever grow up; and they are bound to affect some tenants who until now have had little cause to fear dispossession or to concern themselves about: he compensation to which it would entitle them. While inter-departmental consultations always take place with a view to minimising loss of good agricultural land, we must face the fact that there will be development proposals which will cost us farming land. Compensation is, of course, payable already, and I will run briefly over the existing arrangements before speaking of the problem of improving them where land goes to development.

A private landlord always terminates a tenancy under the Agricultural Holdings Act, 1948. Public authorities, even those possessing compulsory powers, sometimes do the same. In these cases the tenant is entitled to compensation as is provided under that Act, for improvements and tenant right—with which we are not concerned today—and, under Section 34, for disturbance. This Section fixes the amount of compensation within, so to speak, a bracket—and my hon. Friend mentioned the bracket; it cannot be less than a year's rent nor more than two years' rent. Between these limits it is for the tenant to show that he should receive more than the minimum. This is one procedure.

There is an alternative, for authorities possessing compulsory powers. These authorities can and often do proceed by notice of entry. The tenant's claim for compensation is then made under legisla- tion concerning compulsory acquisition. Compensation under this procedure includes loss of profit, for it amounts to the value of the tenant's unexpired legal interest, plus the loss or injury he may sustain, whether by severance or total loss of the holding. Under this procedure, if the term of his unexpired legal interest is short, the tenant will get correspondingly less for loss of profit, and this is a point that we have very much in mind.

In addition, there is the discretionary power, which my hon. Friend mentioned, which Section 22 of the Agriculture (Miscellaneous Provisions) Act, 1963 gives, but only to authorities possessing compulsory powers. This permits them to compensate a displaced tenant for the loss which, in their opinion, he will sustain to his agricultural business. It is common ground that in some cases tenant farmers who have to give up land because of development suffer financial hardship, but this is not always so. For example, if a tenant so affected—and my hon. Friend mentioned this case—happens to be on the point of retiring anyhow from farming and if he gets compensation for disturbance "according to the book", then nobody would maintain that he suffers financial hardship. On the other hand, if a tenant is in his prime and his farming is satisfactory, we all know that he is very unlikely, because of the security of tenure provisions, to have to quit unless the land is taken for non-agricultural purposes.

It has been argued that such farmers, unless it was known that early development was likely, have an expectation of continuing on their holdings which is cut short by the notice to quit for development, which of course is not contestable. and that this loss of expectation is not adequately compensated by the provisions I have mentioned. Moreover, where the portion of his holding lost is large, such a tenant will have to find other land, or even another home, and there is no denying that this is becoming more difficult to do.

This, then, is the complicated problem for which we are urgently seeking a remedy. It might be easier if we could confine our efforts to cases where tenants are dispossessed because of public development. But I do not think this would be right. Tenants also suffer hardship if they lose land because a private landlord gets permission to develop, and we would be reluctant to adopt a solution that did not place similar liabilities on public and private landlords. This is the answer to hon. Members who have suggested in the past that all would be well or much better if we simply made obligatory the discretionary power which authorities possessing compulsory powers have under the 1963 Act to compensate tenants for their loss.

A further complication arises from the fact that, as we all know, the gain to the owner is often greater where the development is for commercial purposes or for housing than if it consists of, say, a reservoir or road-widening scheme in a rural area. These are the kinds of difficulty that must be thrashed out between the Departments and other bodies concerned.

My hon. Friend would, naturally, have preferred to hear that we are ready to announce a solution. This is not so, however. Nothing effective can be done without legislation. Moreover, a solution must be found which takes into account a number of interests, not exclusively agricultural. And, of course, the bodies representative of the agricultural landlords and tenants—C.L.A. in addition to the N.F.U. and so on—who are particularly concerned, are applying their minds to the problem.

Although my hon. Friend was anxious that I should try to explain the reasons for the delay in this matter, I emphasise again that this is a very difficult problem. I have tried to pinpoint the difficulties and the discussions that are taking place. These discussions have been going on for some time. We must take into account the views of all concerned, together with the suggestions made by my hon. Friend. I assure my hon. Friend that all concerned sincerely wish to settle this matter. We will press on with a sense of urgency.

Question put and agreed to.

Adjourned accordingly at six minutes past Five o'clock a.m.