I move that the Bill be now read a Second Time. It is scarcely necessary for me to enter into any detailed review of the legislation dealing with the provision of cottages and plots for agricultural labourers, but a brief review is necessary in amplification of the terms of the Bill now before us. Before these cottages and plots were provided the dwelling accommodation available for rural workers was worse than bad. Many of them were boarded by their employers and their earnings were insufficient to enable them to maintain a separate dwelling. Unlike the urban worker who needed a proper house at a rent below the economic standard owing to his inability to meet the full charge, the rural worker not alone needed a proper house, but he needed it at a nominal rent and with a garden plot large enough to enable him to supply his domestic needs and thus conserve his earnings to acquire such necessities of life as he was unable to produce himself.
The parent Acts (the Labourers Acts, 1883 to 1931) are closely allied to the Land Acts. Earlier legislative efforts were made to place on the farmers the onus of providing proper housing accommodation and allotments for their workers, but without success. Among other things it was difficult to place the onus on any particular farmer in the many cases where labourers worked for more than one employer. The Labourers Act of 1883 brought the local authority into action and initiated the machinery under which cottages and plots could be provided by these bodies for rural workers under loans raised on the security of the rates. The expenses incurred by local authorities were charged as a rate on the sections of their areas in which the cottages and plots were provided. In other words the expenses were shared by all the farmers for whom the labourers might be available.
The development of the Labourers Acts may best be gauged by the alterations made from time to time in the definition of the term "agricultural labourer." At first this definition referred only to persons doing agricultural work for hire. In 1903 the expression was extended to include other persons working in a rural district whose wages did not exceed 2/6 per day and who were not in occupation of more than one-quarter of an acre of land. In 1919 the limit of 2/6 per day was removed and the definition was further extended to include any person who worked for hire in a rural district or any person not working for hire but working in a rural district at some trade or handicraft without employing any persons except members of his own family. The one-quarter acre limit for land holding was preserved.
The area on which expenses of the Acts were charged has also been altered from time to time. These expenses, originally charged on the section of the area in which the cottages and plots were provided, were from 1998 chargeable on the entire rural district and since 1933 have been chargeable on the entire county health district. A more even distribution of the charges resulted from each change. Up to 1906 the provision of cottages and plots was financed mainly by loans issued by the Commissioners of Public Works. With the aid of these loans, the repayment period of which varied from 20 to 50 years, some 20,351 cottages were provided. The burden on the rates, increasing each year as new schemes were carried through, was attaining telling proportions, when in 1906 provision was made for the payment of subsidies from State Funds in relief of the charges on the rates. The periods of most of the pre-1906 loans were extended and an Exchequer contribution was made towards the loan charges. This State contribution amounts at present to an annual sum of £29,205 6s. 2d., which meets about 26 per cent. of the loan charges.
From 1906 loans for the purposes of the Acts were issued by the Irish Land Commission on Land Purchase Terms (68½ years repayment period with an annuity of £3 5s. 0d. for every £100 borrowed). Of the loan charges on these loans 36 per cent. is met by a State contribution which amounts at present to £44,388 per annum in respect of some 21,571 cottages.
From 1925 to 1932 small cash grants were available for the provision of cottages and a limited number of schemes were carried out under these grants with short-term loans raised by local authorities from their Treasurers. About 544 cottages were provided in this way.
Since 1932 the present Housing Programme has been in operation and under it 4,754 cottages have been completed and 3,954 are in progress. The schemes under which the present cottages are provided are financed by loans from the Commissioners of Public Works repayable in 35 years with interest at 4¾ per cent. per annum. The State pays 60 per cent. of these annual loan charges.
In all, about 47,000 cottages and plots have been provided to date at an expenditure of £9,000,000. The cottages are let at rents averaging 1/2 a week for pre-war cottages and 2/- a week for those provided since.
The existing code makes no provision for the sale of cottages and plots to tenants. Two great difficulties in the way of any scheme of sale were:—
(a) the inability of the tenant to pay or repay any sum approaching a market price for his cottage and plot, and
(b) the danger that alienation would follow sale at the very uneconomic price the tenant could afford.
Notwithstanding these serious difficulties the Government felt that the natural desire of the tenants for vested ownership should be met if at all possible. To this end a Commission was appointed by me in 1932 to report on the following matters:—
(1) whether there is a demand from the general body of tenants for vested ownership;
(2) whether the formulation of a scheme of sale acceptable to the general body of tenants is practicable without placing an unreasonable burden of cost on the ratepayers or increasing the liability of the State;
(3) whether the sale of the cottages and plots to the occupying tenants would be advantageous to the agricultural labourers as a class or whether the alienation of the property by sale to the sections of that class at present occupying cottages and plots would tend to bring about ultimately a serious housing shortage for the class as a whole;
(4) whether the average present tenant is in a position adequately to maintain the property in addition to paying a purchase charge and rates should a purchase scheme be carried out?
The Commission were also requested to suggest a scheme of sale if such were considered by the Commission to be practicable and advisable.
The Commission's report has been duly published. It shows the Commission's findings:—
(a) that a demand from the general body of tenants for vested ownership exists;
(b) that the formulation of an acceptable sale scheme was practicable without placing an undue burden on the ratepayers or increasing the liability of the State;
(c) that the sale of the cottages and plots to the occupying tenants would be advantageous to the agricultural labourers as a class and, with adequate provision against alienation outside the class, need not lead to a housing shortage; and
(d) that the average present tenant is in a position to maintain his small property in addition to paying a purchase charge and rates.
The Commission suggested the following scheme of sale:—
(1) tenant to pay an annuity, the equivalent of 75 per cent. of his present rent, exclusive of rates, during the unexpired period of the loan under which the cottage was provided;
(2) tenant to bear in future the cost of all repairs and to keep and maintain the property generally to the satisfaction of the local authority;
(3) annuities to be collected in quarterly or half-yearly instalments;
(4) cottage to be put into repair by the local authority before sale;
(5) Vesting Order to provide against alienation to any person except a member of the purchaser's own family or to another agricultural labourer.
The Commission also recommended that the legal successor of a tenant or a person who was an agricultural labourer when he became tenant but had ceased to be an agricultural labourer owing to economic changes, might be permitted to purchase in the normal way, and that a person who was never during tenancy an agricultural labourer, but had been in occupation of the cottage for a considerable period, might be permitted to purchase on an assessed value of the holding.
The Commission's report and recommendations have been very carefully examined and it is with the object of giving effect to them, in the main, that the Bill now before us has been introduced.
It is intended to fix the purchase annuities on the basis recommended by the Commission, viz. 75 per cent. of the present rent, save in cases where it is found that the amount of the present rent is unreasonably in excess of the rents generally prevailing for similar cottages and plots in the district. There are cases of cottages provided under short term loans in which the rents were fixed with some regard to the high loan charges payable on the cottages and these cases will have to be reviewed.
As to repayment periods, it is felt that full acceptance of the Commission's recommendation, that the period in each case should be the unexpired period of the loan under which the cottage was provided, would lead to serious inequities from the points of view of both the tenants and the local authorities.
There are actually cases in which loans have already been paid in full or have only a few years to run, although the cottages provided under them are not as old as other cottages on which there is a substantial part of the loan period yet to run. This is due to the varying loan periods in respect of pre-1906 cottages and to the short-term borrowings between 1925 and 1932. In such cases the tenant would get his cottage free or on a very short purchase period, while in other cases, where a long term loan was raised, the tenant would perhaps have a 30 years purchase period for a cottage of the same age or perhaps considerably older. From the local authority's point of view there would be the inequity of giving away a cottage free or on very short purchase period just because the ratepayers, by meeting heavier annual loan charges, funded the loan in a shorter period.
The Bill, as drafted, enables all such inequities to be removed. If the Bill is accepted each local authority will be required to formulate its sale scheme. The basis I intend to put to the local authorities to determine the purchase period in each case is as follows:—(a) for cottages and plots provided under pre-war schemes: the equated period of all loans raised in respect of such cottages and plots in the area of the local authority from which is to be deducted in each case the age of the cottage; (b) for cottages and plots provided under post-war schemes: 35 years from which is to be deducted in each case the age of the cottage.
As to pre-war cottages, if we assume that the equated loan period in a local authority's area is 65 years, then the purchase period for a cottage 30 years old would be 35 years, and for a cottage 40 years old, 25 years. In this way inequities will be brought to a minimum. In the case of post-war cottages the purchase period is based on the present repayment period for loans under the Labourers Acts. The basic period for repayment period calculations is much shorter than the basic period for pre-war cottages, but the rents in which the annuities are to be calculated are correspondingly higher.
Purchase schemes under the Bill will require the approval of the Minister for Local Government and Public Health, who may modify a scheme or direct the preparation of a new purchase scheme. Each approved purchase scheme is to be laid before the Oireachtas.
It has not been found possible to accept the recommendation of the Commission that persons who were never agricultural labourers during tenancy be permitted to purchase, but the Bill proposes an amendment of the definition of agricultural labourer which it is believed will bring in all deserving persons. The Bill does not, in itself, affect the tenancy of persons who were never agricultural labourers during tenancy, but it is, and always has been, the duty of local authorities under the parent Acts to conserve the cottages and plots for agricultural labourers.
Under the Bill the following tenants may purchase their cottages and plots:—(1) an agricultural labourer, or (2) the widow of a deceased agricultural labourer who before his death was the tenant of such cottage, or (3) a person who, when he first became such tenant, was an agricultural labourer, and provided no rent is due by the tenant in respect of his tenancy. Where application to purchase is made, the local authority shall make an order vesting the cottage in the tenant in fee-simple, subject to the payment of the purchase annuity.
To enable the vesting of fee-simple interest in each case provisions are included in the Bill to facilitate the speedy acquisition by local authorities of fee-simple interest in cases where this is not already vested in them. A limited number of cottages on State lands cannot be included in the Bill, as the alienation by the State of such property is prohibited by the Constitution.
It is provided that a purchased cottage shall not, during the payment period, be used for any purpose except the accommodation of:—(1) the purchaser; (2) on the death of the purchaser, his widow; (3) an agricultural labourer. Provision is also included to prevent the alienation of the cottage other than by operation of law or by sale with the consent of the local authority.
Before sale the local authority must put the cottage in good repair and sanitary condition and thereafter it must be maintained in good repair and sanitary condition by the purchaser. The local authority is empowered to enter and repair at the expense of the purchaser in his default. A cottage which has been purchased may not during the payment period be mortgaged or charged.
Provision is included to enable resumption by the local authority on breach of the statutory conditions, but, to avoid hardship, the local authority is empowered, with the consent of the Minister, to suspend for a period any statutory condition which restricts the purpose for which a cottage may be used.
The Commission recommended that where the purchaser of a cottage and plot becomes the vested owner of land under the Land Commission the entire holding should be consolidated, and provision to this end is included.
On the question of alienation I should like to point out that the Commission's suggestion was that provisions prohibiting alienation should operate for all time. This, however, is entirely foreign to the fee-simple title it is proposed to vest in the tenant and its continued enforcement would be practically impossible. The matter has been met in the Bill by applying the statutory conditions, including that prohibiting alienation, during the repayment period, and it is not intended, save in the case of consolidation under the Land Commission, to empower purchasers to redeem their annuities so as to free themselves of the statutory conditions. In the case of a consolidation the position is, of course, entirely different. The owner of the consolidated holding has ceased to be an agricultural labourer, and the statutory conditions are no longer required. In any other case, however, it is felt that provision enabling redemption of the purchase annuity and, in consequence, release from the statutory conditions, would provide too great a temptation to redeem and dispose of the cottage and plot for profit.
Certain representations were made by the Commission on matters which do not fall within the strict scope of this Bill, but which are allied to the general question of the welfare of agricultural labourers. They relate to the allocation of land to agricultural labourers, to the provision of cow-parks and turbary rights for them. I have drawn the attention of the Minister concerned to these representations, and I am informed that they do not require further legislation.
The Commission suggested that where cottages are being provided in an area where land is of poor quality, such cottages should be provided with plots of not less than three acres. This suggestion has been fully considered, and it is difficult to see how it could be given effect to. The price of land varies to a considerable extent throughout the country, and it is regulated more by the use to which farmers in different areas put their land rather than by the quality of the land. In parts of Counties Louth and Galway land is very nearly as dear as in Dublin County. In Meath it is only half the Dublin price in many cases. In North Tipperary it is only about half the Meath price. The price, therefore, does not give much indication of the quality of the land. If the quality of the land has to be taken into consideration as the factor determining the quantity to be acquired for each cottage, endless disputes are bound to arise as to the quality of land proposed for acquisition.
It is also likely that applicants may tend to seek quantity rather than quality in the selection of sites, and land-owners may succeed in ridding themselves of useless plots where with a more careful effort on the part of local authorities suitable sites on land of good quality could be found. The position would probably resolve itself into an effort throughout the country to secure as much land as possible at the cost of an acre in Dublin, where the price is highest, and local authorities would find themselves in the position of having to spend £70 or £80 on land in areas where rents approaching the Dublin rents could not be obtained. This would increase the loss on local authorities in the provision of cottages. The present policy of my Department is to insist on the selection of sites on good land, and this is more beneficial to the applicants.
A "separate recommendation" was made by four members of the Commission regarding the reduction of 50 per cent. in land annuities payable by Land Commission tenants and suggesting "favourable consideration" of the position of existing tenants of labourers' cottages. The suggestion is made without a full appreciation of the position. It is often overlooked that the tenant farmer and the cottage tenant are not in comparable positions. The former had heretofore paid the full annual charges on the purchase price of his farm. The rent at present paid by the latter, after allowing for cost of repairs, insurance and collection, meets only about 20 per cent. of the annual charges on capital expenditure in the provision of the cottages, while the gross rent meets only about 35 per cent. of the total annual charges in respect of the cottages (made up of annual charges on capital expenditure, cost of repairs, insurance, collection and other charges). It will be seen that the cottage tenant is and has always been much more handsomely treated than the Land Commission tenant is now.
We feel convinced that the cottage tenant himself will be the first to admit that this Bill affords him immeasurable social advantage. We have approached this problem solely from the point of view of meeting, if at all possible, the natural demand of the cottage tenant for vested ownership.
I would like to take this opportunity of expressing my appreciation of the invaluable work done by the Commission of Inquiry. They have shown us the way in which this natural demand could be met. If the Bill is accepted by the Oireachtas it is completely in the hands of the cottage tenants to make a success or a failure of the measure. I personally feel that it will be a great success and that we shall never have cause to regret the extent to which we have gone in this proposed legislation to make the rural worker a better citizen.
