Section 2 — Conversion from 1991 Act tenancy to limited duration tenancy

Agricultural Holdings (Scotland) Bill: Stage 3 – in the Scottish Parliament at 9:45 am on 12th March 2003.

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Photo of George Reid George Reid Scottish National Party 9:45 am, 12th March 2003

Amendment 4 is grouped with amendments 45, 5 and 46 to 48. I must point out that if amendment 4 is agreed to, amendment 45 is pre-empted.

Photo of Murdo Fraser Murdo Fraser Conservative

Amendment 4 seeks to clarify the provisions in section 2(1). As drafted, the wording of that subsection seems to imply that the landlord and tenant cannot, by agreement, bring to an end a tenancy under the Agricultural Holdings (Scotland) Act 1991 unless they enter into a 25-year limited duration tenancy. However, at the moment, tenancies are often terminated by agreement without notice being given. Amendment 4 seeks to enable 1991 act tenancies to continue to be terminated without the landlord and tenant having to enter into a fresh lease.

I move amendment 4.

Photo of Allan Wilson Allan Wilson Labour

What I am about to say will—[ Interruption. ]

Photo of George Reid George Reid Scottish National Party

I should say to the chamber that we are considering a bill this morning. A lot of chuntering and private conversations are going on. I would be so grateful if members who wished to engage in such activities would do so outside.

Photo of Allan Wilson Allan Wilson Labour

Thank you, Presiding Officer. We are about to discuss and debate some very complex and technical matters, and a degree of silence in the chamber would be useful in that regard.

I want to preface my remarks by pointing out that my colleague Ross Finnie and I will be saying consistently that, after further consultation with the industry since stage 2, the National Farmers Union of Scotland and the Scottish Tenant Farmers Action Group have argued that it remains too easy for an unscrupulous landlord to attempt to coerce a tenant into agreeing to convert a 1991 act tenancy into an LDT. That is despite the fact that the minimum term of a new LDT created in such a way is 25 years, instead of the usual 15 years. I should also make it clear that that industry consultation took place before the Executive amendments were lodged, which partly explains the earlier comments on that matter.

Amendments 45 and 46 reflect a suggestion by tenants groups that a cooling-off period should be introduced to offer greater protection for 1991 act tenants who agree to convert their tenancy into an LDT. As a result, the amendments introduce a period of 30 days after a conversion agreement has been entered into for the parties to withdraw without penalty. Although that right will apply to both parties, we expect that it will be particularly helpful for tenants.

Although amendment 5, in the name of Fergus Ewing, is similar in scope, it seeks to provide for an extended three-month cooling-off period. I should point out that the 30-day period reflects a time frame that the STFAG suggested to our officials. It also compares favourably with cooling-off periods in other circumstances. For example, where a person signs a regulated consumer credit contract in their own home, the cooling-off period ends five days after they receive a notice of their cancellation rights. Furthermore, where a person signs a timeshare agreement in this country, there is a 14-day cooling-off period during which the debtor can cancel the contract and any related credit agreement. As a result, I ask Fergus Ewing to give way in favour of amendment 45.

Amendment 47 seeks to build on section 2(3), which entitles the tenant to compensation at waygo for improvements. The amendment seeks to ensure that any such compensation that the tenant receives at that time can include compensation for improvements that arise out of non-agricultural activities. Amendment 48 is simply a technical adjustment.

Amendment 4 seeks to clarify that section 2(2) must be followed where a 1991 act tenancy is converted into a 25-year LDT. However, we cannot support it as it would conflict with amendment 45, which is more substantive and better fits the bill. As a result, I ask Murdo Fraser to withdraw amendment 4 in favour of amendment 45.

Photo of Fergus Ewing Fergus Ewing Scottish National Party

I should begin by declaring a potential interest as a member of the Law Society of Scotland. However, I never quite had the courage to practise in the area of agricultural holdings law because, as the minister has pointed out, it is one of huge technical difficulty. I am sure that members will understand my approach in that regard.

In amendment 45, the minister has proposed a cooling-off provision that differs from the provision in my amendment only in the length of time involved. I lodged amendment 5 because last week I was unsure whether the Executive was going to lodge such an amendment, although I had understood that it would do so. I am happy not to move amendment 5 and will support the Executive amendments in this regard.

Throughout today's proceedings, the SNP will argue that tenants have had a poor deal over the past period and that they should have a better deal. Our approach is to ensure that that happens, which is why we will oppose the Conservatives' amendment 4. Such a pattern might well emerge throughout the day.

Photo of George Lyon George Lyon Liberal Democrat

I should begin by declaring an interest. My family have been tenants on the Bute estate on the isle of Bute for 230 years.

I support amendments 45 and 47, because I believe that a cooling-off period is vital. Over the past 20 years, a number of tenants—almost 30 per cent on our estate—have converted from full-blown tenancies to partnership agreements. I am not sure that many tenants realised what they were signing away. As a result, it is essential that tenants have a cooling-off period to allow them to reflect on the matter and to give them a chance to withdraw.

We also need as much information as possible to go out to both sides of the arrangements—to tenants and landlords—to make it clear what the bill's provisions will mean in practice. On too many occasions in the past, tenants have signed away their rights under the Agricultural Holdings (Scotland) Act 1991 without knowing what they were doing. They need better information about their rights, particularly those that they will have under the bill, which will strengthen the tenants' side of the argument.

Amendment 47 is also an excellent amendment, which would ensure proper compensation if tenants invest in diversification projects. Amendment 47 is welcome, and my party and I support it.

Photo of Alex Fergusson Alex Fergusson Conservative 10:00 am, 12th March 2003

I thank Fergus Ewing for withdrawing amendment 5 because that saves me from speaking against it. That trend will become more apparent, because of my reaction to his amendments, as the debate goes on.

We welcome amendments 45 and 46 and the proposed provision of a cooling-off period. We will welcome almost all the measures that were proposed by the cross-industry stakeholders group, which worked so hard during the bill's earlier stages.

Photo of George Reid George Reid Scottish National Party

I do not know whether you want another cut, Mr Wilson.

Photo of Allan Wilson Allan Wilson Labour

I do not want to interfere in the private squabbles of the Opposition parties.

Photo of George Reid George Reid Scottish National Party

In that case, I ask Mr Fraser whether he is pressing his amendment 45.

Photo of Murdo Fraser Murdo Fraser Conservative

I was a bit confused by Fergus Ewing's approach because it seems to me that amendment 4 is purely technical and would make no policy difference or provide any advantage to landlord or tenant. I cannot understand why Fergus Ewing opposes amendment 4.

The minister said, if I remember correctly, that my amendment 4 addressed a legitimate point but, because it conflicted with the wording of Executive amendment 45, the Executive would not support amendment 4. I ask the minister, in all seriousness, why on earth the Executive did not take any conflict into account when it lodged its own amendments, which were lodged subsequent to the amendments that I lodged. If there is a serious point to be addressed, it is a pity that the Executive did not take that conflict into account when it became apparent that the wording of my amendment 4 sought to cover the same points as are covered by amendment 45. The situation is rather unfortunate.

Photo of Allan Wilson Allan Wilson Labour

As I said, we think that our amendments 45 and 46 better reflect how we envisage the bill acting in concert with existing legislation. It is unclear how section 2 would work alongside—dare I say it—section 21 of the 1991 act, if amendment 4 were agreed to. That is why we ask Mr Fraser to withdraw amendment 4 in favour of Executive amendment 45.

Photo of George Reid George Reid Scottish National Party

The question is, that amendment 4 be agreed to. Are we agreed?

Members:

No.

Division number 2

For: Aitken, Bill, Douglas-Hamilton, Lord James, Fergusson, Alex, Fraser, Murdo, Goldie, Miss Annabel, Johnstone, Alex, McIntosh, Mrs Lyndsay, McLetchie, David, Monteith, Mr Brian, Scanlon, Mary, Tosh, Mr Murray
Against: Adam, Brian, Alexander, Ms Wendy, Baillie, Jackie, Barrie, Scott, Boyack, Sarah, Brankin, Rhona, Brown, Robert, Canavan, Dennis, Chisholm, Malcolm, Deacon, Susan, Eadie, Helen, Ewing, Fergus, Fabiani, Linda, Ferguson, Patricia, Finnie, Ross, Godman, Trish, Gorrie, Donald, Grahame, Christine, Grant, Rhoda, Hamilton, Mr Duncan, Henry, Hugh, Home Robertson, Mr John, Hughes, Janis, Hyslop, Fiona, Ingram, Mr Adam, Jackson, Dr Sylvia, Jackson, Gordon, Jamieson, Cathy, Jamieson, Margaret, Jenkins, Ian, Lamont, Johann, Livingstone, Marilyn, Lochhead, Richard, Lyon, George, Macdonald, Lewis, Macintosh, Mr Kenneth, Maclean, Kate, Martin, Paul, Marwick, Tricia, Matheson, Michael, McAllion, Mr John, McAveety, Mr Frank, McCabe, Mr Tom, McLeish, Henry, McLeod, Fiona, McMahon, Michael, McNeil, Mr Duncan, McNeill, Pauline, McNulty, Des, Morgan, Alasdair, Morrison, Mr Alasdair, Muldoon, Bristow, Mulligan, Mrs Mary, Munro, John Farquhar, Murray, Dr Elaine, Neil, Alex, Oldfather, Irene, Paterson, Mr Gil, Peacock, Peter, Peattie, Cathy, Radcliffe, Nora, Robison, Shona, Robson, Euan, Rumbles, Mr Mike, Scott, Tavish, Simpson, Dr Richard, Smith, Elaine, Smith, Iain, Stephen, Nicol, Stevenson, Stewart, Stone, Mr Jamie, Ullrich, Kay, Wallace, Mr Jim, Watson, Mike, White, Ms Sandra, Whitefield, Karen, Wilson, Allan

Photo of George Reid George Reid Scottish National Party

The result of the division is: For 11, Against 77, Abstentions 0.

Amendment 4 disagreed to.

[Amendment 45 moved—[Allan Wilson]—and ] agreed to.

Amendment 5 not moved.

Amendments 46 to 48 moved—[Allan Wilson]—and agreed to.