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Knight, Dame Jill (Edgbaston)

Knowles, Michael

Latham, Michael

Lennox-Boyd, Hon Mark

Lester, Jim (Broxtowe)

Lloyd, Sir Ian (Havant)

Lord, Michael

McCrindle, Robert

Maclean, David

McNair-Wilson, Sir Michael

McNair-Wilson, Sir Patrick

Madel, David

Malins, Humfrey

Mans, Keith

Maples, John

Marland, Paul

Marshall, John (Hendon S)

Martin, David (Portsmouth S)

Maude, Hon Francis

Maxwell-Hyslop, Robin

Mayhew, Rt Hon Sir Patrick

Mellor, David

Meyer, Sir Anthony

Mitchell, Andrew (Gedling)

Molyneaux, Rt Hon James

Montgomery, Sir Fergus

Morrison, Sir Charles

Moss, Malcolm

Moynihan, Hon Colin

Mudd, David

Newton, Rt Hon Tony

Nicholls, Patrick

Nicholson, David (Taunton)

Nicholson, Emma (Devon West)

Page, Richard

Paice, James

Pawsey, James

Porter, David (Waveney)

Portillo, Michael

Powell, William (Corby)

Raison, Rt Hon Timothy

Redwood, John

Renton, Rt Hon Tim

Rhodes James, Robert

Ridsdale, Sir Julian

Rowe, Andrew

Ryder, Richard

Sackville, Hon Tom

Shaw, David (Dover)

Shaw, Sir Michael (Scarb')

Shelton, Sir William

Shephard, Mrs G. (Norfolk SW)

Skeet, Sir Trevor

Smith, Tim (Beaconsfield)

Stanbrook, Ivor

Stanley, Rt Hon Sir John

Steen, Anthony

Stern, Michael

Stevens, Lewis

Stewart, Allan (Eastwood)

Stewart, Andy (Sherwood)

Stradling Thomas, Sir John

Summerson, Hugo

Taylor, Ian (Esher)

Taylor, John M (Solihull)

Tebbit, Rt Hon Norman

Thorne, Neil

Townend, John (Bridlington)

Tredinnick, David

Twinn, Dr Ian

Viggers, Peter

Wheeler, Sir John

Widdecombe, Ann

Wiggin, Jerry

Yeo, Tim

Young, Sir George (Acton)

Tellers for the Noes :

Mr. David Lightbown and

Mr. Irvine Patnick.

Question accordingly negatived.

Order for Third Reading read.--[Queen's Consent, and Prince of Wales's consent, signified].

4.54 pm

Mr. Redwood : I beg to move, That the Bill be now read the Third time.

It gives me pleasure to move the Third Reading of this legislation which will represent a major advance in the security offered to tenants. It is part of the package of measures brought forward as a result of the Monopolies and Mergers Commission inquiry into the brewery industry and was designed to give to the tenants of brewers and other pub landlords the same protection as is available to other business tenants.

I know that the measure is welcomed by the National Licensed Victuallers Association and by Members on both sides of the House who wish to see an improvement in the protection of tenants in this important industry. The debates in Committee have been based on an agreement that there should be an improvement in the protection offered to tenants, but there will be detailed debates about the exact nature of that protection, the balance struck in the landlord and tenant legislation and the way in which it might be improved. I have sought to show in Committee and on the Floor of the House that the well tried and tested balance of this legislation, introduced in 1954 by a Conservative Administration and amended and improved by a Labour Administration in 1969, is the right balance. It will assure tenants that they have reasonable protection of their tenancies and assure landlords that it is still a worthwhile

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business relationship for them to enter into, so that the supply of tenancies will not dry up. Those seeking to become publicans will thus not be impeded or prevented by over-protective legislation. During the debate I have been asked by Members to give some assurance about the kind of monitoring that will take place once the legislation has received Royal Assent. I will give two pledges. There will be monitoring of the general balance of landlord and tenant legislation as the Department of the Environment goes about its business as custodians of the corpus of the law and seeing that it is modern and up to date. There will also be monitoring by the competition authorities to ensure that the package of measures presented by the Government to implement the findings of the MMC report have a good impact on the brewing industry as a whole. I have already said to the NLVA that its views will be welcomed through the usual channels if it wishes to make points about the way in which the new settlement for the brewing industry is developing.

Mr. Lawrence : I am most grateful to my hon. Friend for that assurance. He may have noticed that I deliberately abstained in the last vote because I was not satisfied that he had given that assurance hitherto. Will he go one stage further? Monitoring is all very well, but if it is discovered that something is going wrong and tenants are being exploited by landlords, will he be prepared to suggest amendments to the legislation to provide the kind of protection envisaged in the Monopolies and Mergers Commission report?

Mr. Redwood : I have explained that we must examine the legislation as a whole as it affects all business tenancies. I have also explained that there are a number of safeguards within the structure of that well tried and tested legislation--most notably the fact that the tenant and landlord have to go to court. They must jointly and severally present their wish to contract out of the Landlord and Tenant Act 1954, and it is that court process which provides the best guarantee that hon. Members seek.

The legislation must be seen against the background of the changes in the brewing industry. A number of changes were under way anyway because of economic change within the industry. The nature and style of pubs are changing. Brewers were looking again at their types of asset portfolios and deciding whether it was right for them to be both brewers and pub owners. The MMC report, which found against the brewers on a public interest basis, has resulted in measures which will serve to reduce and weaken the ties between brewers and their tenants. That is welcomed on both sides of the House as being in the interests of a more competitive industry and of a better deal for the customers of pubs. There may well also be benefits for the licensees themselves, many of whom want parts of the MMC report implemented and have made representations accordingly.

In the course of the debates, the Committee and the House have examined the position of widows. I said a few minutes ago that the Government were anxious to see that widows were well protected. I repeat that under this legislation they will be able to take over tenancies from their deceased husbands if those husbands have nominated them as their successors. Widows will then have all the rights and obligations of the tenancies previously enjoyed by the landlords who predeceased them. That is an important advance for widows in the industry, which is

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distinct from some other sorts of business tenancy in that the business will also often be the living accommodation of the tenant concerned.

The Opposition have raised the issue of the right to buy. In their proposals on that right they limited themselves to the idea that in a limited number of cases there would be an explicit legal right to buy at best price by the tenant. The Government welcome the opportunity for tenants to buy their pubs, but it is in the commercial interests of the brewer to sell his pub for the best price. I am sure that many brewers thinking of selling pubs will also think of offering them to the tenants and will be open to approaches from the tenants if the latter can come up with the sort of good price that the Opposition had in mind. I cannot see that the Opposition amendment would make much difference to that right. Tenants may well buy their pubs more commonly from their brewer landlords and we should be happy about that if it arose out of usual commercial arrangements within the industry.

Contracting out has been extensively debated and in Committee we also looked into the issue of goodwill. Any departures from the regime identified in the landlord and tenant legislation would require careful consideration as they would affect the delicate balance between landlord and tenant set out in the law. However, I have listened carefuly to the comments in Committee and to other representations on this subject, especially to the argument that publicans should be entitled to compensation at a higher multiplier on rateable value than other tenants as they are usually in the same business as their landlords.

Those are arguments of substance on which I continue to hold an open mind. The representations will need to be considered not only from the perspective of the brewing industry but in the wider framework of the provisions for business tenants in the Landlord and Tenant Act 1954, for which the Department of the Environment has general responsibility. Ministers will be looking at the script of today's debate and the Committee debates for that and for other reasons.

Mr. Vivian Bendall (Ilford, North) : I understand that compensation is dealt with by the Department of the Environment, and I hope that it will examine the issue seriously. It was discussed fully on Second Reading and at great length in Committee. Although we should not deviate from the Landlord and Tenant Act more than necessary, this problem must be dealt with because many tenants work in pubs for many years only to find at the end of that time that the brewery can take back the pub and their years of work may have amounted to nothing. If the Department of the Environment could be persuaded to use a higher multiplier, that might overcome some of the objections in this area.

Mr. Redwood : My hon. Friend has professional experience in related subjects. He knows that the valuation of goodwill is extremely difficult and to try to incorporate it in the legislation by means of the amendment moved today would be neither possible nor desirable, given the compexities in the legislation. I am grateful for my hon. Friend's comment, but the issue must be examined in the context of level treatment as between different types of business tenancy, and of the balance in the legislation.

By any standards this is the most important advance in tenant protection since the war. The Government are pleased to bring forward this legislation, which was sought

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by certain Opposition Members as well as by Conservative Members. It was also sought by the NLVA, which has actively put its case across. I hope that I have dealt with the points raised by the Opposition and by the NLVA in its correspondence with many hon. Members. A number of hon. Members have written to me ; to list them all would take too long, but I hope that my remarks today and my replies in correspondence will meet their concerns. On issues such as widows' rights, this is an important advance, and I am proud to commend the Bill to the House.

5.7 pm

Mr. Henderson : As the House will recall, the Opposition originally intended to support the Bill in principle, as we said clearly on Second Reading. I trust that that impression was reinforced in Committee. Throughout the Opposition have attempted to put genuine points to the Government, of which there were four or five principal ones in Committee.

The amendment that we moved on Report emphasised what we believed to be the key modification required to give the legislation teeth, but throughout our proceedings the Government have put obstacles in our path. The Minister has already acknowledged that there was a good debate in Committee. There were points of agreement, and some new points with which the Government had considerable sympathy were made. But the Minister's praise for his colleagues in Committee has been more generous than his actions. The truth is that this is the same Bill, on Third Reading, as the one which the Government presented to the House.

The Minister has said that the legislation enhancing tenants' protection is one of the most important pieces of legislation for the industry to have come before the House. I agree, but I enter the caveat that it is only potentially the most important legislation. Because of the Government's failure to agree to modifications put forward by hon. Members on both sides of the House, the legislation will be left considerably weaker than would have been desirable--and necessary to achieve unanimous support.

The Government have not listened to the arguments--for example, about the timing of the legislation. If too long a period is allowed in which contracts can be renewed, undue pressure is placed on tenants by brewers to change contracts to the disadvantage of the tenant. That will also be disadvantageous to competition in the industry, and it will ultimately be disadvantageous to the consumer. The Government have failed to acknowledge the importance of what is referred to as the right to buy. In Committee the Government acknowledged that that issue will rear its head regularly as brewers begin to dispose of tenancies, swap them and seek to change the nature of tenancy contracts. At that time the issue of what happens to the existing tenant will arise. Will he have rights that accrue because of his commitment to the business and the tenancy? In Committee the Government acknowledged that the Opposition proposals about that were limited and related only to a specific proposal where a brewer disposes of a tenancy to a third party non-brewer. It did not cover a brewer disposing of a tenancy to another brewer. The suggestion advanced by the Opposition in Committee related to the right to buy so that when a brewer feels that there is a need for commercial or other reasons to dispose of a tenancy the person or body that has the first right to buy is the sitting tenant. There was no

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