House of Commons Hansard Debates for 19 Apr 1995

Mr. Llwyd: Will the Secretary of State comment on the attitude to the Bill of the larger of the two farming unions in Wales? Has he received representations from it?

Mr. Waldegrave: As is well known, the two organisations have taken a different view. I had a productive and positive meeting with them during one of my visits to the Principality. They remain sceptical. I am not claiming that there is total unanimity; some members of the National Farmers Union in different parts of the country remain doubtful. I do not want to over-exaggerate, but it is fair to say that there is wide consensus in a pluralistic industry. In my experience, most of the participants are characters with strongly held, independent views. Therefore, I think that the level and extent of agreement is remarkable.

I should add one additional word of thanks. The House is always sympathetic to constituency points. Without getting into trouble over advertising, I should like to thank the principal legal experts on the subject, Burges Salmon and Andrew Densham, and others of my constituents who have helped my Department and Members of Parliament with advice during the passage of the Bill. As I am talking on a personal basis, may I say that I should have begun my speech by repeating a declaration of interest? As the House knows, I have a shareholding in a family tenant farm. It is unaffected by the Bill, as we have not made the mistake of introducing retrospective legislation.

The Bill's aims, as we said on Second Reading, are to tackle the decline in tenancies offered, to open up opportunities to new entrants and to provide flexibility for agriculture to remain internationally competitive. The background must be not that the present position is a satisfactory one that we need to maintain but that it is unsatisfactory. Whatever the theoretical intentions behind previous Acts passed by the House may have been, we know what the position is.

We know that the great majority of tenancies that are being let are for fewer than two years under various loophole arrangements that have been devised--largely by Burges Salmon and other of my constituents. We are not removing rights that apply to secure tenancies that are being let. They are not being let--instead, short, loophole tenancies are being let. The number of new tenancies under the Agriculture (Miscellaneous Provisions) Act 1976 is minuscule--it has almost dried up. That has brought the present legislation into disrepute and has brought the Tenant Farmers Association and others to their present conclusions.

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Many of my hon. Friends are knowledgeable on the subject and, as has been said, the Bill's main feature is to respect the freely entered into contract between landlord and tenant. There may have been periods in our social history when there has been a great imbalance one way or the other between the two partners. I would not deny that that happened in the 19th century, but if we look at the modern British farming industry we see that those days are long past. We can expect a reasonable degree of negotiation and a reasonable balancing of interests to emerge from freely entered into tenancies. I think that we shall see a variety of such tenancies after September this year--some for long periods, some for medium-length periods and some for short tenancies. The length of each tenancy will reflect what is economically sensible and what suits the best interests of both parties. It will be affected by the nature of the holding and so on. The key point for new entrants is that, if they can overcome the all-important initial hurdle of gaining access to land, at least they have a chance to show their mettle and build up a track record and a long-term business.

All landlords want good tenants, and most want to keep them once they have found them. Longer tenancies will flow from mutual trust, not legal compulsion. We have tried that policy and it has not worked. That fact was well expressed in a press release issued by the Tenant Farmers Association, which states:

"It must be better to bring more land on to the market than to face the present steep decline in the long term let sector, one which would continue if the law imposed a long term tenancy."

That view now prevails in all the main industry organisations. Sir David Naish, the president of the NFU, is on record as saying: "tenancy reform will breathe new life into the farming industry". We have made a number of amendments to the Bill, both here and in another place, which we think have improved it. Some of those amendments have been introduced with the agreement of the Labour party; all of them, without exception, have been fully supported by the industry. Others have been argued for by my hon. Friends, as we heard today.

We have also included a new clause--a key complementary step--in the Finance Bill that will extend inheritance tax relief to new lettings. All in all, we are doing everything within our power to revitalise the tenanted sector.

Some commentators have expressed doubts about the extent to which we will succeed and about the lack of security for tenants. However, I have not heard anyone suggest a practical way in which the Bill could do more to persuade those who own agricultural land to provide new tenancy opportunities.

I was a little saddened by the fact that the Labour party voted against Second Reading. It seemed unwise for the Opposition to fly in the face of such wide support in the farming community and I had hoped that they would take a more constructive approach.

It is perhaps ironic that the House seems to take a more old-fashioned attitude to such matters than one would expect. The noble Lord Carter, in explaining the Labour party's position in another place, adopted a more temperate approach to the matter. I would hardly expect Labour Members to agree now that we have been right all

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along and they have been wrong. One lives in hope, but I think that it would be surprising if they were to change their minds tonight. I make one point to the Opposition. We have taken great care to avoid retrospection in the Bill. We could have decided quite reasonably- -in fact, many people urged us to do so--to go back and clear up what many consider to be the mess that Labour created with its 1976 legislation. We could have decided to abolish the succession rights that applied to pre- 1984 tenancies, to give security to generations of successors and so on. There was quite a lot of pressure on us to do that.

We resisted the temptation on the ground that in this area, above all others, retrospective legislation is bad. We did not intend to follow Labour's precedent of passing retrospective legislation. Where the Bill might have had retrospective effect unintentionally or indirectly--such as in relation to the constituents of my hon. Friend the Member for Worcestershire, South (Mr. Spicer), who followed the long-established Evesham custom with which the House is now expert--we took steps to amend it in order to avoid that consequence. Surely it is right to ask the Opposition to make the same commitment today. I think that the Liberal Democrat spokesman, the hon. Member for North Cornwall (Mr. Tyler), made the same point. I advise people that the risk of a Labour Government in the foreseeable future is very small. Nonetheless, others are less well informed than me about the matter. Some landowners--for reasons best known to themselves--may harbour such fears. If they are to be encouraged to let land now--I think that that is the unanimous view of the House--it is vital that they should not be put off by the spectre of retrospective legislation introduced by a future Labour Government. In order to remove any disincentive to letting that may stem from such fears--unjustified though they may be--I call upon the Opposition to make a firm and clear pledge today not to introduce any future legislation on the subject which would have a retrospective effect. Opposition Members have referred to monitoring today and my hon. Friend the Minister of State has responded positively to their points. We should allow the Bill to work effectively and not damage its chances of working by passing remarks about it or by making promises or pledges into the future. That is the least that the Labour party should be prepared to do in order to give the Bill a proper chance to work effectively in the interests of tenants. I believe that we have improved the Bill a great deal during consideration in this and in another place. It is now a very good Bill which goes as far as it is reasonable to go. We should now look with confidence to a significant boost in the tenanted sector from 1 September this year onwards. Perhaps then the distant echoes of 1976 will finally die away. I commend the Bill to the House.

5.53 pm

Dr. Gavin Strang (Edinburgh, East): I am not sure about the distant echoes of 1976, given that I am closely associated with the Agricultural Holdings Act 1976. I shall refer to that later in my speech.

The Labour party has opposed the legislation and we stand four square in our continued opposition to it. My hon. Friends and I have put our case on a number of occasions in the House and we have taken that position

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because we are fundamentally committed to security of tenure for tenant farmers. We are concerned that the legislation will lead to inadequate security of tenure for tenant farmers. We regard that as, first, socially unjust and, secondly, not in the long- term interests of agriculture.

I do not need to restate all the arguments--indeed, I touched on some earlier this afternoon in relation to monitoring. We believe that we should be united in our desire to encourage long-term, secure tenancies. People who wish to move into farming should have a proper opportunity to make a profit, build up capital and provide an honest living for themselves and their families. That is why we are committed to the family farm.

We do not wish to stratify the industry; there may be a role for contract farming. As I said in the Second Reading debate, some people begin farming with contract farming companies and then enter the industry in their own right. We have set out our proposals for encouraging new entrants to go into the industry which I believe will prove extremely constructive.

We have tackled the issue of milk quotas which is a real barrier for young farmers entering the industry. Often in the past, people entered that type of farming because of the regular milk cheque. We have tackled the issue of the way in which county council holdings have ceased to provide a stepping stone into the industry. There are many reasons for that, for which I not blame the present Government. [Interruption.] I thank my hon. Friend the Member for Stoke-on-Trent, South (Mr. Stevenson) for his intervention.

I blame the Government for the fact that many

Conservative-controlled councils have been selling those holdings and we are concerned that that will continue if there is further reorganisation of local government. We have already touched on our attitude to tenure and taxation and the prospect of taking advantage of European Union legislation on retirement for farmers--many of whom continue farming into their 70s, if not later--to create the opportunity for a son, or daughter or an outsider to enter the industry. I do not think that we need any lessons or lectures- -to his credit, the Minister has not sought to deliver any--about encouraging new entrants into the industry.

Earlier this afternoon, I referred to the Northfield committee report, which contains a lot of viable material. The committee had a balanced membership--I think that is to the credit of John Silkin, who is no longer with us--which was certainly not loaded in favour of the Labour party. I shall refer to its report later.

I shall deal with the question of security of tenure most constructively by referring to the remarks of the Minister of State in his winding-up speech on Second Reading. He was challenged by me on the issue and said:

"I was interested in a press release that the hon. Member for Edinburgh, East issued on 18 November 1994, in which he said: `Security of tenure is essential for the family farm'-- as though that was a newly-discovered truth, which had not dawned on the Conservative Benches for many a long year. I was surprised that neither he nor his hon. Friends mentioned the construction of the Bill in clauses 1, 5, 6, 7, 16, 23, 24 and 25, all of which concern various aspects of security that are central to the subject of agricultural tenancy".

The Minister went on to say:

"I am afraid that the hon. Gentleman shows an inability to distinguish between the period of an agreement and the security embodied in that agreement. The Bill is drafted in terms of the

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definition of farm business tenancy: willing partners come together, in mutual interest, to define their rights and responsibilities, and to make very clear one with another the length of time that they agree a tenancy should run. The Bill gives precise legal protection on the ending of a tenancy. Once agreed and signed, it is cast iron and copper-bottomed and provides excellent security of tender. That is the whole basis and construction of the Bill."--[ Official Report , 6 February 1995; Vol. 254, c. 105.]

It may be that there is a difference in language, but the phrase "security of tenure" is explicit, in my view, in that it does not refer to whether a contract will be honoured, nor to how much money a farmer might get if the contract is terminated prematurely. It does not refer to how copper- bottomed a five-year or 10-year tenancy may be. It is either about lifetime tenancies or about long-term fixed tenancies. In relation to the individual farmer and his family who are running a farming business, the phrase "security of tenure" relates to the security that he has to go on farming.

The legislation will transform the position of new lettings, and there can be no argument about that. The new farm business tenancies will come into operation on 1 September 1995 and, for the purpose of shorthand, I shall describe these as Tory tenancies. Already in place--and, as the Minister pointed out, not interfered with by the legislation--will be the traditional tenancies governed by earlier legislation, and for shorthand I shall call them Labour tenancies. Within the group of Labour tenancies, two types of tenancy operate. The first group are the tenancies governed by the Agricultural Holdings Act 1976, which is still operative in relation to some tenancies and about which the Minister feels strongly--as, I am sure, do many other owners of land. My local newspaper described his speech on the matter at the Conservative party conference last year as a personal attack on me. I am not sure whether that was a fair judgment, but the right hon. Gentleman certainly articulated his bitter opposition to the principle that a son or daughter of a tenant farmer, who has worked perhaps for the bulk of his or her life on the holding, should have a qualified right to succeed to the tenancy. Nothing that has been said in the debate has altered my view on the subject. The Minister may accept that something should be encouraged on a voluntary basis, but I believe that there is a case for encouraging a working son or daughter on a tenant farm to have the opportunity to succeed, and we enacted legislation to give a guarantee of that. There is a Scottish tradition in that area, and I accept that it has not existed for the same duration in England. The second type of Labour tenancy is the tenancy governed by the Agricultural Holdings Act 1984, which the Government enacted to remove the succession provisions. The tenancies are governed either by the 1976 Act or by the 1984 Act, although there was a consolidation of the legislation in 1986. Basically, the new Tory tenancies will be in place from 1 September 1995. We also have the Labour tenancies, within which are two groups--those with succession rights and those without.

Mr. Waldegrave: Let me make clear that we have no antipathy at all to the idea of children succeeding their parents in farming. My neighbour in Somerset is a fifth generation tenant, and a fine farmer. The trouble is that

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the introduction of the compulsory legal principle has not preserved the system, and it has so dried up the supply of tenancies that it has become a dead letter. It is the failure in reality --as to the theoretical principle--to which we have objected, and we have come to believe that radical reform is necessary.

Dr. Strang: I am happy that the right hon. Gentleman has clarified his position.

I am coming to what I regard as the crunch point. We want to give the legislation an opportunity to work. That means in essence that people who let land after 1 September 1995 must have the prospect of their contract remaining. Despite the fact that I have not used the word "retrospective" in the context of the Bill, I accept the right hon. Gentleman's use of the word on this issue.

In that sense, I am happy to give an undertaking that a Labour Government will not legislate retrospectively, and any new tenancy created after 1 September 1995 will be honoured. If we can treat the tenancies as contracts, a contract for five years will last for five years if the legislation provides that it can continue by mutual agreement. The same will apply should the contract be for 10 years, 50 years or whatever. No Labour Government will legislate to break that contract or tenancy. I cannot be clearer than that.

We are saying to the industry--including the Country Landowners Association, the National Farmers Union, the Tenant Farmers Association and the young farmers organisations in Wales and England which supported the agreement that provided the basis for the legislation--that we will honour the position that they have adopted and that the Government have put into the legislation, and we will give it an opportunity to work.

Mr. Waldegrave: May I be the first to welcome the hon. Gentleman's commitment? It will help. Although there is no doubt about what he said about no future Labour Government breaking a contract, would such a Government convert a tenancy into some other form of tenancy? The fear may be that a five-year or 10-year tenancy will be converted into a tenancy of some other form which might last longer. Will the hon. Gentleman make it clear that contracts will be honoured as they are made?

Dr. Strang: Yes, that is correct.

Mr. Edward Garnier (Harborough): Will the hon. Gentleman give way?

Dr. Strang: I shall give way, although I wish to wind up my remarks. A number of hon. Members--particularly Labour Members--wish to speak.

Mr. Garnier: I accept and welcome the undertaking on retrospection that the hon. Gentleman has given the House relating to what he calls "Tory tenancies". Can he explain in a few words the Labour party's policy on any new legislation that it might wish to introduce and that might affect tenancies not covered by the 1995 measure?

Dr. Strang: I am grateful to the hon. Gentleman for making a constructive intervention. Of course, any Labour Government reserve the right to enact new legislation in this area. It may well be that, in 10 years' time--from the Opposition Benches--the hon. Gentleman will appeal to a Labour Government to introduce new legislation. The point is that legislation such as this will relate only to the

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new tenancies. It may apply to tenancies that commence in 2010, or whenever. [Interruption.] Did I say that the hon. Gentleman would be in opposition in 10 years' time? I am sorry. It may be during the next Parliament, or the one after--I am not sure. It is conceivable that the next Labour Government will be in power for longer than the Conservative party. Sixteen years is long enough--not long for an agricultural tenancy, but long enough to have the Conservative party in office.

We welcome the constructive way in which the Bill was dealt with in Committee. My hon. Friend the Member for Clwyd, South-West (Mr. Jones) and other members of the Committee helped to achieve security and protection for tenants, which we value.

Mr. Clifton-Brown: The industry will welcome the hon. Gentleman's important clarification on retrospective legislation. If a Labour Government wanted to legislate on existing tenancies when they could naturally be brought to an end, when the period of notice to quit could operate, would such tenancies be subject to the provisions of new Labour legislation--or would they be allowed to continue on the existing terms for a further period?

Dr. Strang: The hon. Gentleman seeks to draw me into impractical areas of debate. I accept his good intentions, but I met the essential point that anyone letting land on the basis of the Bill from 1 September 1995 will know that the contract between landlord and tenant will not be altered by Labour legislation.

We want to give the Bill an opportunity to work, but we will vote against it because we are committed to the principle of security for tenants. The key point is that we will not implement legislation in a way that would prevent the Bill working as the industry and the Government want it to work.

6.11 pm

Mr. Clifton-Brown: I am grateful to catch your eye, Mr. Deputy Speaker, to speak on Third Reading of what has been described as a milestone in landlord and tenant legislation. I pay great tribute to my right hon. Friend the Minister of Agriculture and to my hon. Friend the Minister of State, who piloted the Bill through Committee. They listened to the Country Landowners Association, National Farmers Union and associations representing young farmers and tenant farmers. I ought to declare that I am a member of the CLA and NFU and I farm, so I have an interest in the Bill-- although its provisions do not affect me directly.

Land in England, Wales, Scotland and Northern Ireland should be farmed to the highest possible standard. The Bill can only enhance that standard. The word "stewardship" has not been mentioned, but it should be. All involved in agriculture should give stewardship the highest priority.

It was a remarkable milestone for all sections of the industry to reach an historic agreement on a deregulatory measure. All sides of the industry having agreed, my right hon. Friend drafted a Bill and brought it before the House, and today we are giving it a Third Reading. Is it not remarkable that the only people who cannot see that it is a worthwhile measure are Labour Members? Surely it is better to have a let farm than one that is not let. When, under Labour in 1976, a farm was let to a tenant and

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succeeding tenants, the letting market dried up almost overnight--as the hon. Member for Edinburgh, East (Dr. Strang) knows full well. It is sad that Labour Members will vote against the Bill tonight, because they will be sending a signal to the industry not to let farms under its provisions. There are 10,000 short-term agreements.

Dr. Strang: The hon. Gentleman is in danger of distorting the position. We made it absolutely clear that new tenancies under the legislation would be honoured. I hope that he will not seek to muddy the waters and give landowners or tenants a misleading impression.

Mr. Clifton-Brown: I welcome that intervention, in the sense that I hope to be proved wrong and hope that the industry will have the confidence to let under the Bill's provisions, because I desperately want a flourishing landlord and tenant sector. The Opposition's stance can only endanger that process, which is why I appeal to them to think again, even at this late hour. I say as loudly and clearly as I know how that it is better to have a let farm than a farm not let.

I desperately want to encourage young farmers. As I said on Second Reading, the average age of tenants is 55. I want it reduced considerably. Only new blood and fresh and innovative ideas will make the industry flourish. I fear that the Opposition will impede that process.

I fear also for the 40,000 workers in agriculture. Whatever Labour does, farms will inevitably become bigger. The one thing that will accelerate enlargement is the absence of a flourishing landlord and tenant sector. I want lots of people letting farms under the legislation, and I am confident that the current 10,000 short-term arrangements to skirt the 1976 and 1986 legislation will be encompassed by the Bill.

Even if the average size is only 100 acres, that will produce the 1 million acres that the Royal Institute of Chartered Surveyors predicted. Even the hon. Member for Clwyd, South-West (Mr. Jones) predicted 3,200 new tenancies on an average farm size of 250 acres. On Second Reading, I calculated that would produce a total of 750,000 acres. There is no disputing the fact that a substantial amount of land will fall under the scope of the legislation.

Mr. Llwyd: Does the hon. Gentleman agree that the majority of the short lets to circumvent existing legislation and Gladstone v. Bower agreements were made by established farmers and cover small parcels of land tacked on to an already flourishing situation? Also, not all Opposition parties support the Bill, as the hon. Gentleman suggested. I have misgivings, and I hope to catch your eye, Mr. Deputy Speaker, to explain why.

Mr. Clifton-Brown: In my experience, the number of short-term agreements are increasing rather than decreasing. The number of contractual, Gladstone v. Bower agreements have actually increased over the past few years, because of uncertainty in the industry about embarking on full landlord and tenant letting under the 1986 legislation. I hope that the Bill will reverse that trend. I agree with the Opposition that longer- term lettings are wanted; only then can the tenant secure borrowings and plan for a proper farm system. I hope that the industry will have the confidence to let for reasonable terms, to give younger tenants more opportunities.

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I pay sincere tribute to my right hon. Friend the Minister for playing a major part in changes to inheritance tax legislation: equalising relief for let and vacant land is a major plank and will encourage lettings. But I would like him to go slightly further. There are two other tax impediments that may--

Dame Elaine Kellett-Bowman: Inhibit?

Mr. Clifton-Brown: I am grateful to my hon. Friend.

There are two other tax impediments that may inhibit landlords in letting land. The first one is income tax treatment. Vacant farms come under schedule D and are treated as a trade. Let farms come under schedule A and are treated as an investment. The reliefs that are available under A are much more limited than under D. I hope that my right hon. and learned Friend the Chancellor of the Exchequer will give consideration to the equalisation of tax treatment.

The second tax anomaly that will inhibit landlords in letting farms is treatment under capital gains roll-over relief. Again, there is different treatment for let and vacant farms. Perhaps my right hon. and learned Friend the Chancellor will consider whether that anomaly can be overcome.

I look forward to speculating on what the Bill, when enacted, will do. I would like the situation in the commercial property letting market to apply, whereby let commercial properties are worth the same--in many instances they are worth more--as vacant properties. That would be entirely healthy for agriculture. It would mean that let land and vacant land values were more nearly the same. At present, there is a 50 to 75 per cent. differential. I should like values to come much closer together, and that is possible.

I was discussing the Bill with some large institution farmers. They are beginning to have some exciting ideas about how institutional money might be put into agricultural land. Under the Bill, they would have the certainty of getting vacant possession at any time they wanted it. They would be able to let land to new, young entrants into farming. I hope that they would do so, for that is precisely what we want to see. I hope that that will happen because at this moment some agile minds are considering how it might be achieved.

Mr. Tipping: Will the hon. Gentleman give way?

Mr. Clifton-Brown: I shall be delighted to give way to a person with an agile mind.

Mr. Tipping: I am delighted to be thought to have an agile mind. I shall use that agility in trying to establish the hon. Gentleman's purpose. Earlier, he talked about getting new, young farmers on to the land, but now he is talking about institutions being able to get rid of new, young farmers when they want to do so. Clearly there is a contradiction.

Mr. Clifton-Brown: Either the hon. Gentleman was not listening or he did not understand what I was saying. I was talking about more institutional money being available to buy land specifically to let to younger tenants. That is exactly what I want to see. At present, younger people cannot afford to buy and farm the bulk of the agricultural land that is held. The capital involved is so

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great and the return on capital so low that unless someone has a huge amount of capital behind him or is lucky enough, as I was, to inherit a farm, it is impossible to enter the industry.

As a Conservative, I want to encourage young entrepreneurial individuals, who perhaps have been involved in the industry as contractors or merchants, for example. I hope that they will have the opportunity to farm a small amount of land, thereby getting on to the farming ladder. We want to encourage entrepreneurial and innovative people to go into the industry for the benefit of that industry, so that our industry remains the most efficient in Europe.

I wholeheartedly welcome the Bill. I urge the House to give it a Third Reading as soon as possible so that it can be put on to the statute book forthwith and the industry can benefit thereby. 6.23 pm

Mr. Enright: First, I apologise to the Minister for having to be absent during his wind-up speech. There was a joint meeting of the all- party rugby league group. I had to attend to put the case for the Featherstone rugby league club. I know that Mr. Deputy Speaker is even more devoted than am I. It was imperative that I should attend. I was saddened to hear the Secretary of State praise the statement from the Tenant Farmers Association. In a previous incarnation, the right hon. Gentleman was responsible for good and clear English. I shall read one of the crucial passages in the statement, which states:

"Instead, much professional effort is devoted to using the short term alternatives within the present law (such as `Gladstone Bower' lettings which can not even be as along as two years), MAFF approved lettings (no more than five years and effectively unrepeatable) or to creating contrivances to avoid it."

That is the most appallingly unclear English that one has ever come across.

I invite the Secretary of State to read the conclusions. The last sentence, which is the last place in which one should make a mistake, is, to put it mildly, wrongly punctuated. The grammar and punctuation are wrong, but above all the reasoning is wrong.

No one would disagree with the Tenant Farmers Association that the present situation is not good. Indeed, it is bad, and it needs to be made better. The Bill merely makes it less worse. As my hon. Friend the Member for Edinburgh, East (Dr. Strang) has said, it will not create a vehicle to bring about the sort of justice that we want. I shall briefly touch upon a subject on which the Secretary of State is well versed--the question of foedere aequo, foederi in aequo. We, the Opposition, are trying to introduce a measure of fairness in agreements. It is not fairness when City institutions become involved. The hon. Member for Cirencester and Tewkesbury (Mr. Clifton-Brown) sounded, although he tried to clarify his position later, like someone seeking a sort of highland clearance. He did not give the impression that he was seeking to encourage the future of real tenant farmers.

We in the manufacturing industry and we who represent mining areas know only too well the destruction that can be caused by short-term City funds. City funds are exactly the sort of funds that are not required for the long -term interests of farming. I am amazed--I apologise,

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Mr. Deputy Speaker. I am not amazed, because the hon. Gentleman is a Tory. I am not amazed that he could say such a thing.

Mr. Clifton-Brown: I think that the hon. Gentleman misinterpreted what I said. There are few farmers who do not have some form of City funds, as the hon. Gentleman calls them, involved in their operations. They are called farm overdrafts. What is better: to have a long-term City institution owning the land on which they have a low return or for the tenant farmer to have an overdraft in the knowledge that short-term interest rates can fluctuate violently? Within the past three years, interest rates have increased to over 15 per cent., and that is base rate. What is better: to have a long-term stable arrangement or a short-term unstable arrangement?

Mr. Enright: If I had any evidence that institutions were lending money long-term on stable low interest rates, I would be delighted to accept the hon. Gentleman's proposition. Such evidence is not available. I agree wholeheartedly with the hon. Gentleman's criticism of the banks. They have been truly appalling in the money that they have been screwing out of farmers and of people in many other industries.

We are maintaining that this is not a fair Bill. It does not achieve parity between the landlord and the tenant farmer. The Government may say--it is a philosophy--that the landlord should be completely in control of what is happening, but we, the Opposition, would maintain that that gives the landlord the ability considerably to exploit tenants.

There is talk about a massive consensus. The Secretary of State has said that there is a consensus between the Tenant Farmers Association, that well -known follower of Gracchi agricultural reform, the Country Landowners Association and the National Farmers Union, which was so radical in the beliefs that it professed. We have also the young farmers, like David Archer, who is trying to get a contract for a new firm. These radical organisations are coming into agreement. What an amazing thing. The amazing thing would be if they in no way agreed. The hon. Member for Stroud (Mr. Knapman) said--I shall finish on this point, as many hon. Members wish to speak--that the Bill was near perfection. Near perfection, indeed. We shall certainly monitor him on that. If he thinks that the Bill is near perfection, his standards are so low and his aims are in the mud instead of to the sky. We want to look after the long-term tenants, who are still being thrown to the wolves in the Bill.

6.30 pm

Mr. Garnier: I almost feel that I should congratulate the honourable Agricola for Hemsworth on his restraint during the past few minutes, for using only six Latin words during his entire speech. In Committee, I think that he spoke Latin on a number of occasions. On Second Reading, he may also have used Latin as well. It is a great pleasure to see someone who descends from the great Latin scholars and who farms so heavily the gooseberry patches of Hemsworth-- [Interruption.] Is it rhubarb? That such great rhubarb should emanate from Hemsworth is something to be noted and welcomed.

Mr. Enright: The hon. and learned Member for Harborough will be aware that, in previous years, the

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fields in Hemsworth used to vote Conservative. I hope that he has taken on board the fact that this year they are voting Liberal Democrat.

Mr. Garnier: I do not know whether the hon. Gentleman is bragging or complaining. Perhaps we will draw a veil over his personal problems.

The Bill is widely welcomed throughout the industry, and it is a matter of some sadness that the most notable thing that the hon. Member for Edinburgh, East (Dr. Strang) found able to say during the course of his short remarks was--I hope that I quote him correctly--we stand four square in opposition to the Bill, because we are concerned for security of tenure. I paraphrased that. It is a pity that the hon. Gentleman has, with his colleagues, come forward with that attitude.

We had an interesting discussion of the detail of the Bill in Committee. Many amendments were tabled and withdrawn by the hon. Member for Clwyd, South-West (Mr. Jones). It was a sensible Committee, if I may say so, and we have come up with a good Bill. It generated an almost total lack of controversy--I make no criticism of the hon. Member for North Cornwall (Mr. Tyler), who represents the Liberal Democrats and who was unable to be in Committee for the most part--because it came to the House and to another place with the support of the whole industry. I shall not go through the acronyms of all the bodies that are represented in the TRIG. None the less, the Bill is welcome, and I am here today to welcome it on behalf of my landowning and tenant farmers in Harborough.

My hon. Friend the Member for Cirencester and Tewkesbury (Mr. Clifton- Brown) has already mentioned the other wing or leg of the argument that will help to increase the amount of acres let in England and Wales--the alteration to the capital tax provisions. It is worth mentioning that it is not every Cabinet Minister who can persuade the Treasury to yield to his blandishments. My right hon. Friend the Minister of Agriculture is to be congratulated on the subtle and effective way in which he has managed to persuade the Treasury to accede to his requests. It was a worthwhile aim, and I am delighted that he was so successful.

I have heard from a number of landowners that, because of the Bill, they will definitely let land as from 1 September. I regret that they may change their minds or feel rather less comfortable in having made those promises having heard the attitude of the official Opposition. It is regrettable that the Opposition are not coming at the Bill in the spirit in which it has been presented to Parliament and in the spirit in which it has been welcomed by all other interested parties.

In my view, the Bill restores balance. It is fair to say that, in the early 19th century, the balance in the relationship between the landlord and tenant was almost entirely in favour of the landlord. That situation pertained throughout the 19th century. Throughout this century, particularly since the second world war, the balance has gone too far in favour of the tenant, to the detriment of farming and of landowners. I believe that the Bill at last redresses the balance, so that both sides can now look at each other with equality. It is a pity that the Opposition do not recognise that.

It is perhaps ironic that the Opposition, who are so against the hereditary principle when they discuss the other place, should be so in favour of the hereditary

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tenancy legislation of 1976. I wish that the hon. Member for Edinburgh, East (Dr. Strang), who has made it clear that he will not act retrospectively, in the unlikely event of the Labour party coming to power in some future time, on tenancies under the Bill, had been clearer. He inaccurately described them as Tory tenancies. I think that industry tenancies is more accurate, or TRIG tenancies would be the better short form. It is a pity that Opposition Members seem to be putting in doubt the confidence of farmers and landowners who so avidly want to see the Bill work, and who want to see additional land let to new and young entrants to farming.

6.35 pm

Mr. Llwyd: I shall be brief, as I know that other hon. Members want to speak.

Undoubtedly, there was a need for the Bill. In the 1900s, 90 per cent. of the land was let. Today, the figure is 30 per cent. I suppose that the Bill is an attempt to address that problem. I do not support the Bill, because of some misgivings, which I shall briefly enumerate now. Although balance is important, as the hon. and learned Member for Harborough said, there has to be balance between the rights of the tenant and those of the landlord. I do not think that the Bill addresses that balance.

Farming is, of course, a long-term enterprise. There is no such thing as real, useful short-term farming. I do not know what the future holds, nor do I profess to have a monopoly of wisdom on the subject. I sincerely believe, however, that there are problems in the Bill.

It is quite evident that there will be short-term lets, as they are more beneficial to landlords. Short-term lets are not good for the environment. They are not particularly good for communities, for tenants or for the land at large.

I made the point in Committee about Tir Cymen, the Welsh version of country stewardship schemes. I am still not certain about the answer. Will the tenure schemes that are typically available under that scheme be available if land is let, say, for two or three years, or whatever? I still wish to hear from the Minister at some stage about that matter.

The farming industry is the backbone of our rural communities. It is a long -term occupation, and in my view is unlike any other business, because more often than not it provides a home as well. There is a village in my constituency where virtually every farm is let. Some 90 per cent. of the occupants of the village are directly involved in farming. It is important, therefore, that the Bill should work.

We understand full well the notion of freedom of contract, the equality of bargaining and so on, but one must look at supply and demand. There is an insufficient supply of land, but there is a great demand. Therefore, that in itself will dictate terms that may well be onerous for all concerned.

The amendments today are welcome and useful, and I wholeheartedly endorse each one of them. They show that the Minister listened to debates in Committee, for which I am grateful.

Earlier, the Minister curtly put down one of his hon. Friends, saying that he had no control over the timing of the RICS guidelines. That was disingenuous, because, on many occasions during the passage of the Bill, he relied on those

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