New Clause 4

Part of Orders of the Day — Agricultural Holdings Bill [Lords] – in the House of Commons at 5:30 pm on 6 June 1984.

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Photo of Mr John MacGregor Mr John MacGregor Minister of State (Ministry of Agriculture, Fisheries and Food) 5:30, 6 June 1984

I can think of some solutions, but they would be unacceptable in a free country, and unacceptable to the House and to me.

I was trying to make it clear that there is not a simple black and white case that the institutions are making it more difficult to have tenanted land. Indeed, there is a case for saying that by continuing to invest in land, keeping farms together and continuing with the high proportion of let land, the institutions are actually maintaining the process of having a large number of tenanted farms.

It would be invidious to differentiate between different classes of landowner, even if it were practicable to do so, which I strongly doubt. The Northfield committee has been quoted a great deal in the debate. That committee recommended no restraints on the involvement of the institutions in landowning. It was interesting to note that Lord Northfield himself said in debates in another place that the financial institutions should not be subject to special rules which did not apply to all landowners, which is precisely what the new clause would do.

The country has always benefited from a diversity of people being prepared to invest their time and money in land ownership. There is no reason to suppose, on the whole, that the new institutions are less good landowners than the traditional ones. Indeed, as has been pointed out, in some ways—for example, by their sale and lease-back arrangements—the financial institutions can create new tenancies.

The hon. Member for Walthamstow (Mr. Deakins) made an interesting speech in Standing Committee—he spoke about the opportunities for new entrants into farming which the financial institutions could offer—which was somewhat at variance with his comments today. He made some good points in his Committee speech, which I will not repeat now, to demonstrate the contribution that the institutions make.

I remind the hon. Member for Ipswich (Mr. Weetch) that we must consider who are the beneficiaries of the institutions' investments in these cases. By and large, they are trade unionists, the members of pension funds, and I have heard some interesting cases in that respect from an institution in which I should declare an interest in that it is one in which I used to be employed, though not on the agricultural side of the company. I refer to the Hill Samuel agricultural property unit trust, which is showing trade union members where their investments lie in agricultural land — this is a feature of its annual reports — and demonstrating how they are doing a great deal by way of encouraging conservation, planting trees, making financial contributions to village life and the communities in which the farms lie. The institutions are explaining the wider benefits of investment in agricultural land.

At best, therefore, the new clause is largely unnecessary, as the overwhelming proportion of land owned by the financial institutions is already let, and, from the current signs, that proportion is increasing. At worst, by arbitrarily and unnecessarily restricting the institutions' freedom of management, it would act as a disincentive to investment in agriculture, and that could only be to the detriment of the industry as a whole. My answer to the hon. Member for Ipswich, therefore, is that the contribution of the institutions has been beneficial to agriculture and agricultural efficiency as a whole.

My hon. Friend the Member for Norfolk, South-West, who knows the feeling in the countryside better than anyone in the House, made some fair points. Not least because of the efforts that he has been making, more of the institutions are responding along the lines that he desires, and I commend that. I share his view, however, that taking clear-cut legislative steps of the sort proposed and trying to make these changes by legislation is not the way to deal with the problem. The case has not been made for the change proposed, either in terms of the harm to farming that the institutions are said to be doing or for the benefits to be achieved by such a change.

6.15 pm

I accept the point that the hon. Member for Aberdeen, North made about information, in that part of new clause 5 flows from the recommendations of the Northfield committee. As he knows, as a result of section 2 of the Agriculture (Amendment) Act 1984, a private Member's Bill which has just completed all its stages through the House — it was introduced by my hon. Friend the Member for Gainsborough and Horncastle (Mr. Leigh), who is present today—agriculture Ministers now have additional power to obtain information on types of land occupancy. That explains to a large extent why that information has not existed until now. Until my hon. Friend's measure became an Act, the powers were limited to asking for the names and addresses of owners and occupiers, whether the land was let and, if so, at what rent.

The new powers cover the collection of information about the terms on which, or the arrangements under which, any land or any part of it was owned, occupied, managed or farmed by any person. This will allow Ministers to ask questions about the family relationship between occupiers and to ask whether the land is held under a partnership or occupied by a private company, trust, charity and so on. As I say, this legislation has been enacted in the light of the Northfield recommendations and will ensure that the necessary statutory powers are available to identify important trends in the pattern of land ownership and occupancy. I am sure that the hon. Member for Aberdeen, North will welcome that, although it means that to a large extent the new clause is not necessary.

I could not follow the hon. Member for Aberdeen, North in asking for a separate report to Parliament each year. To do so would be unnecessary, and therefore we need not burden the Bill with such a provision. The results will, in due course, be published in the normal way. We have not taken precise decisions on how the information will be published—because the necessary powers for its collection have only just been obtained — but it is reasonable to assume that it will be widely available in much the same way as the results of the Department's annual rent surveys are published, in booklets, or it could be made available in the annual review. Either way, that information will be available to Parliament and a separate report, as suggested in the new clause, is not necessary.

The second part of the new clause—the requirement that Ministers should make recommendations on ways of increasing the amount of land available for letting—is equally unnecessary. I do not believe that by asking for an annual report we shall change matters. We need to take action, and that is precisely what we are doing by the Bill and by the changes that we have made, in successive Finance Bills, to capital taxation which has been a great disincentive to landlords. I have pressed the hon. Member for Aberdeen, North on many occasions to give his support to the changes that we have made in taxation, but so far without success.

The hon. Gentleman could do something that would help a great deal more than asking for annual reports. He could go further than he went in Committee by saying that, if there is general agreement in the industry that clause 2 is a desirable part of the legislation, he will make it clear that the Labour party, should it ever return to power, would not repeal that clause.