Orders of the Day — Land Development (Compensation)

– in the House of Commons at 12:00 am on 23rd July 1976.

Alert me about debates like this

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Thomas Cox.]

10.17 p.m.

Photo of Lieut-Colonel David Mather Lieut-Colonel David Mather , Esher

I do not. wish to detain the House unnecessarily at this late hour, but the matter that I wish to raise is important to individual rights and personal freedom. I wish to, speak about the procedure relating to compensation for development land and the unfair and unsatisfactory way in which it is administered. It concerns particularly the Land Compensation Act 1973, the White Paper "Development and Compensation—Putting People First" and the Land Compensation Code entitled "Your Home and Compulsory Purchase".

I maintain that in the case that I am raising the objectives of these measures have not been reached. I refer to the River Mole flood alleviation scheme. This secheme was introduced after the disastrous floods in my constituency in 1968 along the River Mole, the River Thames and the River Ember. They were almost repeated and a disaster only narrowly avoided in October 1974.

The flood alleviation scheme was introduced through the efforts of my predecessor and myself and as a result of great pressure from constituents after the floods. I am very much in favour of the scheme, because it is a much-needed measure to prevent a similar disaster.

The scheme was the subject of the last Adjournment debate that I initiated and I should like tonight to examine the other side of the coin—the injury to those victims who may be subject to what is called desirable developments. Although the White Paper to which I referred was introduced by a Conservative Government, I believe that its provisions are supported by the present Government.

The White Paper makes several important points. There is to be a "new approach" on the quality of everyday life, and it adds: … a balance must constantly be struck between the overriding duty of the State to ensure that essential developments are undertaken for the benefit of the whole community and the no less compelling need to protect the interests of those whose personal rights or private property may be injured in the process. It adds: This dilemma is at the heart of contemporary political debate. Sometimes the State is seen as playing the role of a juggernaut, putting roads before homes, riding rough shod over the rights of individual citizens. It continues: It is a conflict of right with right—the public's undoubted right to have a new road or school or waterworks and the private person's right to enjoy his home and garden. undisturbed. The opening part, which sets out the purpose of the White Paper, concludes: The Government believe the time has come when all concerned with development must aim to achieve a better balance between provision for the community as a whole and the mitigation of harmful effects on the individual citizen. In recent years this balance in too many cases has been tipped again the interests of the individual. A better deal is now required for those who suffer from desirable community developments. I am certainly not unmindful of the expense of compensation where houses and land have to be taken for development purposes. Indeed, the White Paper says that the measures it foreshadows will mean that some kinds of development will cost more. That, of course, we all must accept. But I believe that proper compensation for individuals should not be sacrificed to the particular economic expediency of the day. We are going through a difficult time in the economic climate, but that does not undermine the principle that the individual must get proper compensation for what he or she will lose.

In a nutshell, my constituent, Miss K. Lechner, has her home on the banks of the River Ember and it has been there for 33 years. To her it is not just a bungalow; it is Home Sweet Home. Miss Lechner has her every comfort and a nice garden, and there she is perfectly content and happy. But this particular property is required by the Thames Water Authority for the flood alleviation scheme. That means taking the whole of this property.

One of the decisions that I contest is that no compensation is being given for her home but only for the land on which it stands, and that land comprises about 550 square yards. The reason why no compensation is being given to her for her home is that many years ago, in 1951, her home was graded as "unsuitable for human habitation."

The story is that Miss Lechner, who is an elderly lady, acquired this 560 square yards' plot in 1943. Her intention was to build a bungalow, but that was not approved by the local authority because of the danger of flood. She then raised the level by six feet, but that was not approved because the carriageway, the short lane leading to the house, was only eight feet wide. There was a caravan standing on the site and she replaced it by a larger caravan and rested it on brick pillars. She added two extensions. One was a small kitchen and the other was a bedroom and a bathroom and this home, which then resembled a bungalow, had all the amenities of water, electricity, telephone and so on. The interior was covered with sheet aluminium, and painted, and the whole effect is very satisfactory. A glass verandah was added, brick steps and a patio. Miss Lechner also revetted the river wall and built a wall on the edge of the river 70 ft. long.

In 1951 after she had lived there for seven years undisturbed, the local authority brought into effect the Town and Country Planning Act 1947 and served an enforcement notice on her to quit because it was said that her home was unfit for human habitation. Following that, councillors from the local authority visited her home and disputed the order. They considered that her house and grounds were in apple-pie order, and in 1954 consent was granted for her to remain there for as long as she wished or for the rest of her life.

After she had lived there for 32 years, during which time there had been no inspection by council officers, the 1968 floods came, a new channel was required 110 feet wide, and there was a public inquiry. An alternative course was proposed, but it was turned down.

The Land Compensation Act 1973 was brought into effect by the acquiring authority, the Thames Water Authority, which then became legally responsible for compensation but, because many years ago the house had been graded as unsuitable, the authority said that it was unable to pay compensation for her home, only for the land. The compensation offered was a paltry £6,000. Yet, the Land Compensation Act is supposed to tip the balance in favour of the individual who is threatened by such desirable developments.

I shall run over what I consider to be the unfair aspects of this case. First, Miss Lechner is not to be compensated for her home, only for the plot of land on which it stands. The lack of a home on the land obviously detracts from that value. An independent surveyor 10 years ago estimated the worth of the property as £19,000. That, perhaps, was putting it a little on the high side.

The second unfair aspect is that, if the house is considered to be unsuitable, it is wrong that Miss Lechner should have been allowed to remain in an unsuitable house for 33 years. Council officials said that that was done as a favour, but I suggest that councils do not perform actions as favours. They perform them as duties or they do not perform them at all.

During the 33 years there was no inspection by officers of the council, no sanitary notice was served and now the home, although not unsuitable enough for Miss Lechner to be evicted during the whole period of 33 years, is not suitable enough to enable her to receive compensation. The authorities concerned cannot have it both ways. Miss Lechner falls between two stools.

The third unfair aspect is that the Thames Water Authority has after all perhaps been generous because it has offered her rent-free accommodation—which the authority would purchase for £16,000—for the rest of her life. But that is a lower level of compensation than would be payable for the home she occupies. Miss Lechner has steadfastly refused to be beholden to anyone. She wants to be independent, to stay independent and to live in her own home, not as the tenant of anyone else. In any case, with the outgoings on rates, the income from the £4,000 which the authority would offer in these circumstances would be hardly enough to maintain Miss Lechner in a much larger house where expenses would probably be twice as great as they are at present where she is able to live comfortably.

The fourth unfair aspect is that it can be argued that the unfitness order was attached to Miss Lechner's right to stay voluntarily for the rest of her life in her home, but with compulsory purchase she is now forced to go involuntarily, and the whole basis of the argument is therefore changed. It is unfair that an unfitness order should still attach and carry with it the effective liquidation of Miss Lechner's home and its value.

The law in this respect says that compensation shall be for the market value of a home. Miss Lechner's home is parcularly well cherished and cared for and some intrinsic value should attach to the owner or occupier of such a home and not just the market value. After all, the value to the owner must be enhanced when it is taken from a person involuntarily as compared with when it is given up voluntarily and put on the market by free will.

The sixth aspect which I consider to be unfair is that Miss Lechner is offered less compensation if she is re-housed by the authority—that is, the compensation will drop from £6,000 to £4,000. The Minister will realise that this is not in accordance with the law, and the rule on it is contained in the publication "Your Home and Compulsory Purchase" page 10, paragraph 46, where it says: Is it true that my compensation might be reduced if I accept rehousing? The answer is this: No. It is illegal for an authority to reduce on this account the amount of any compensation to which you have a right or the amount of any other payment such as home loss payment, well-maintained payment, or disturbance payment. Therefore, I consider that the authority is acting wrongly and against the law.

In conclusion, the main point is that the provisions of the Land Compensation Act 1973, the White Paper "Putting People First", and the Land Compensation Code seem to be honoured more in the letter than in the spirit, and it is clear that the spirit of the Act is being ridden over roughshod by the apparatus of the State. It is not my object to raise expectations which cannot be fulfilled. The procedures which have taken place have been in accordance not with "Putting People First" but, I suggest, with putting people last.

I wish to pay a tribute to Miss Lechner as an individualist who does not wish to be beholden to anyone, who provides for herself, who prizes her independence above all else and who, although she has suffered much mental anguish, has shown great courage and determination in the long years in which she has suffered some degree of harassment over the subject of her home. I believe that she personifies the claim that the Englishman's home is his castle, and I wish that we had more like her. I appeal for generosity in the settlement of this case.

10.34 p.m.

Photo of Mr Guy Barnett Mr Guy Barnett , Greenwich

I congratulate the hon. Member for Esher (Mr. Mather) on raising a very important issue —the relationship between the rights of the individual to enjoy his property undisturbed and the needs of public authorities to carry out development for the community as a whole. I particularly appreciated the sympathetic and sensitive way in which the hon. Gentleman presented his constituent's case. I should like to refer to that later, but to begin with, I want to deal with the general issues, as did the hon. Gentleman.

The issues involved were precisely set out in the White Paper "Development and Compensation—Putting People First", published in 1972. It is from this document that the hon. Gentleman has quoted, and it has incorporated the results of wide-ranging reviews of the policies adopted by authorities undertaking public works, notably highways, and the provisions of the compensation code. New powers were subsequently introduced in the Land Compensation Act 1973 to enable those authorities to do more to mitigate the disruption they cause and to improve and extend the code to secure further the private rights and interests of the individual. In what is a difficult and complex field, full of special cases, this was a major attempt to strike a better balance between individual and community needs.

I shall not weary hon. Members by reciting the list of improvements made in the 1973 Act. They were, however, substantial, and they involved the commitment of sizeable extra public funds. Many people have benefited as a result, though we can never avoid all of the hard cases.

The hon. Member has spoken about the case of a constituent. People whose homes are threatened or taken for public developments frequently object strongly to the intrusion into their way of life. They suffer a measure of disturbance and distress which is over and above any strict monetary value of their loss. The hon. Gentleman emphasised this point and made it particularly well.

Of course, this is not always the case. People are sometimes only too pleased to be moved from sub-standard housing due for redevelopment into modern homes. These are the cases we do not hear about. Nevertheless, there is the likelihood of substantial distress for people pulling up roots firmly put down, and this is recognised in the 1973 Act in so far as special home loss payments, extra to any compensation sum, are provided for. It is estimated that these payments amount to some £22 million a year. I mention this to indicate the practical application of the new powers introduced in 1973.

Before turning to deal with the detail of the points raised, I should perhaps first outline the basis of compensation and other benefits payable where people's homes and land are acquired by compulsory purchase. I do not think there can be any argument that public authorities need compulsory purchase powers if they are to be able to carry out their statutory duties in the public interest, but there are, of course, safeguards for the individual owner in that if he objects, the issues involved are aired at a public inquiry and the appropriate Secretary of State is required to take any objections into account in deciding whether compulsory purchase should be authorised. Basically, it is a question of deciding whether the needs of the acquiring authority, acting in the public interests, outweigh the interests of the owner who wishes to keep his land. But the question of compensation is, and has always been, a separate issue and does not enter into the case for or against compulsory purchase.

In the majority of cases, compensation is assessed, as the hon. Gentleman said, on market value—that is, the amount which the property might be expected to realise if sold by a willing seller on the open market. In addition, the acquiring authority is obliged to pay the proper legal costs and, usually, disturbance compensation for other reasonable expenses and losses which the person has to incur as a result of the compulsory purchase. Ths includes the cost of altering soft furnishings and movable fixtures and fittings to fit them to the new home, telephone reconnection charges, and so on. Then, as I have previously mentioned, if the person has lived in the house for five years before being displaced, there is entitlement to a home loss payment of three times rateable value with a minimum of £150 and a maximum of £1,500.

There are other obligations on authorities. Under the 1973 Act, local housing authorities are required to ensure that any person displaced by public action is satisfactorily rehoused. This might mean providing suitable alternative accommodation available on reasonable terms. Alternatively, the authority may help with the provision of a mortgage, or in the case of the older person or those with low earnings, make interest-only mortgage advances repayable on maturity. There are also provisions for advance payment of compensation.

In essence, the compensation code is intended to give people the open market value for the actual interest acquired, plus their additional necessary expenses. The only significant exception to the market value basis applies to unfit dwellings, where site only value is applicable. But even here supplementary payments to owner-occupiers will normally bring the compensation up to market value.

I have explained these arrangements at some length to demonstrate the scope of the code and the significance in real terms of the 1973 Act extensions. The right hon. Member for Crosby (Mr. Page) on Second Reading of the Land Compensation Bill described the provisions as the most extensive reforms of the law of compensation in favour of the individual that have been put before Parliament for more than a century".—[Official Report, 27th November 1972; Vol. 847, c. 152.] I would not dissent from that view, and there is no evidence to suggest that these provisions are not working as intended.

Against that background I shall try to respond as helpfully as I can to the hon. Member's comments about Miss Lechner's circumstances. I emphasise, however, that that case concerns the proposed acquisition of land by the Thames Water Authority for the River Mole flood alleviation scheme, which the hon. Gentleman supports. This is a responsibility of my right hon. Friend the Minister for Agriculture, Fisheries and Food and not my right hon. Friend the Secretary of State, who is not responsible for either the scheme or the proposed acquisition.

I understand, however, that the recent correspondence has endeavoured to set out the facts of the case, which has a long planning history. It is recorded in the council minutes that in 1954 Esher Urban District Council granted a planning permission for the retention and continued use of the Pilgrims as a dwelling, but by a condition attached to the permission it restricted its occupation to the owner, and required removal of the structure on the expiration of her occupancy. The intention at that time was to be helpful to the occupier. In 1974, the new Elm-bridge Council reaffirmed that the condition attached to planning permission in 1954 should not be varied.

From the re-establishing of these bare facts of the case within the more general issues raised in the debate, it is clear that in so far as the use of the structure on the site is limited by a personal planning permission, so will that factor be taken into account in the open market and in the compensation that should properly be paid. I stress, however, that it is not for me to interpret the law in the particular case.

Nor can I comment on the compensation offered. This is for negotiation between the vendor and her advisers and the acquiring authority. To the extent that a dispute on the sum remains, it may be referred to the Lands Tribunal for determination. The other normal entitlements to home loss and the rehousing provisions would apply, and I understand that the Thames Water Authority has this week reaffirmed offers in this respect.

I apologise for having spoken at such length, but the debate is widely framed, encompassing many detailed and complex points. I have explained the basis of the compensation code and the essential link with market value. This has for many years been the fundamental principle of the compensation code, and must continue to be so.

I do not want to underestimate the distress caused when land is taken, and I well appreciate the sympathy which the hon. Gentleman has shown in what he said about his constituent. But I believe that the provisions introduced in the 1973 Act go a long way towards achieving an equitable balance between the competing claims of the individual and the community

Question put and agreed to.

Adjourned accordingly at sixteen minutes to Eleven o'clock.