I move amendment No. 1:
In page 5, line 27, to delete "thirty" and substitute "fortyfive".
I take it we may discuss amendments Nos. 1 and 2 together?
Rent Restrictions (No. 2) Bill, 1960 [ Seanad ]— Report and Final Stages.
Yes, Nos. I and 2 are related.
The position under existing law is that houses with a poor law valuation exceeding £60 in Dublin and £40 elsewhere are not subject to rent control. Whatever case might be made for amending the law as it stands, it should be obvious to anybody who has studied the matter that this Bill proposes to go too far in adjusting the upper limits. This Bill proposes to reduce the upper limit from £60 to £30 in Dublin and from £40 to £25 elsewhere. Our amendment is designed on a compromise basis, admitting that perhaps a case can be made for amending the law. We feel the furthest the Bill should go is to amend the upper limit for Dublin to £45 and elsewhere to £35.
In the main, the tenants or prospective tenants affected by this Bill are people who for one reason or another seek rented accommodation and who would not in the ordinary way qualify for local authority housing. That is particularly true of Dublin and Cork and the larger centres. The House must know there is a shortage of that type of accommodation. There are people who, because of their occupation or profession, are transferred from one centre to another—Civil Servants, bank clerks, C.I.E. and E.S.B. personnel. They do not qualify for local authority houses. The nature of their employment makes it unreasonable for them to build their own houses. They are the house-hunters whom we seek to protect by amending this section.
Very many of these people find that the only houses available for them for renting are houses up to £45 valuation in Dublin and up to £30 valuation elsewhere. We feel that this section goes so far as to make the already scarce situation worse again for the type of people we have in mind. Many of them would find that the only houses available to them would be at rents which would be exorbitant and completely outside their control. Our amendments in that regard are reasonable. I urge the Parliamentary Secretary to accept them.
I cannot accept either of these amendments. I think I am on fairly safe grounds in rejecting them. Here we are proposing only a very limited amount of decontrol, that is, to remove from control a house which has a valuation over £30 in Dublin city and £25 outside it and of which the landlord comes into possession subsequent to the passing of the Bill or is in possession at the date of the passing of the Bill.
I think Deputy Casey is wrong in thinking this section will reduce the amount of rented accommodation available. I think it will increase it. Houses in this category which subsequently come into the possession of landlords will scarcely be let if the landlord cannot get for them a rent which he thinks fair and adequate. If we remove these future lettings from control the houses are then likely to be let rather than sold. By virtue of the provisions of the Bill we will prevent a number of houses from being withdrawn from the letting market.
The number of houses with a valuation of over £30 in Dublin or £25 elsewhere which are let at the moment must be fairly small. The £30 valuation upper limit covers the vast majority of houses which are let. By fixing the ceiling at £30 and £25 we are achieving a very small amount of decontrol which will not inflict hardship on anybody but which will have the effect of increasing the amount of rented accommodation available.
A house of over £30 valuation is a fairly good class house. In most parts of the country the rates on such a house would be at least £50 or £60. That sort of house is not, properly speaking, a fit sort of house to be subject to Rent Restrictions Acts at all— at any rate so far as future lettings are concerned. The amount of decontrol which will result from this provision of the Bill will, I am quite certain, be very small. I appeal to Deputy Casey to recognise that the limits in the Bill are sensible and fair.
Amendment withdrawn?
No.
Amendment put and declared lost.
Amendment No. 2 not moved.
I move amendment No. 3:
In page 6, line 12, to delete "subsection (4)" and substitute "subsections (4) and (5)".
This is purely a drafting amendment. It is necessary to define "possession" for the purposes of subsection (5) as well as of paragraph (f) of subsection (2) and of subsection (4). Subsection (5) was inserted in this section on Committee Stage in the Seanad.
Amendment agreed to.
I move amendment No. 4:
In page 7, line 7, to delete "Association—" and substitute "Association and deposited in the Public Record Office—".
This amendment proposes to give effect to a suggestion made on the Committee Stage that the agreement between the Dublin Artisans' Dwelling Company and their tenants should be deposited in the Public Record Office. The Minister for Justice has formally authorised the Deputy Keeper of the Public Record Office, in accordance with Section 16 of the Public Records (Ireland) Act, 1867, to receive the agreement. Accordingly it will be available for public inspection at a fee of 2/6 and sealed copies of it will be receivable in evidence. The agreement was deposited in the Public Record Office yesterday.
Amendment agreed to.
I move amendment No. 5:
In page 8, to delete lines 8 to 15 and substitute the following:
"(b) In determining pursuant to paragraph (a) of this subsection the notional rent of a dwelling—
(i) the Court shall have regard to any amount expended on the improvement, structural alteration or repair of the dwelling which is an amount by reference to which a lawful addition within the meaning of the Act of 1946 has been obtained, and
(ii) In the case of a dwelling of which the rateable valuation does not exceed ten pounds and which is a dwelling to which Chapter I of Part II of the Act of 1946 applied, ‘(being dwellings to which Chapter I of Part II of the Act of 1946 applied)' shall be regarded as being contained in subsection (2) of section, 9 of this Act after ‘controlled dwellings'."
Like the last amendment this amendment is to meet a point raised by Deputy Sweetman. Deputy Sweetman was concerned about the application of the provisions of Section 9 in certain cases. He instanced the case of a terrace of identical houses one of which had suffered storm damage or something of that nature and had been the subject of exceptional repairs. The suggestion that Deputy Sweetman made was that the tenant of that house might apply under subsection (2) of Section 8 of the Bill to have the rent reduced on the ground that it exceeded by more than 12½ per cent. of the basic rent the rent which the Court would fix under Section 9 and that the Court would possibly reduce the rent because the basic rent of comparable dwellings in the terrace was considerably lower. The amendment provides that in a case like that the Court would have regard to the special repairs which were carried out on the house and the amount spent on them.
This amendment meets the point I raised and I am obliged to the Parliamentary Secretary for introducing it, but I should like to make this comment. My objection was not that the Court might disregard the exceptional expenditure but that it would be bound to disregard the exceptional expenditure under the previous draft. It is quite clear now that the matter is as it should be, within the discretion of the Court.
Amendment agreed to.
I move amendment No. 6:
In page 9, line 60, and page 10, lines 3, 4, 16, 19 and 28, to delete "building" and substitute "house".
This amendment also arises out of the discussion on the Committee Stage. On that stage we introduced an amendment which authorises a landlord who has done repairs to a multiple dwelling to apportion the exceptional lawful addition among the tenants of that dwelling. This amendment makes it clear that this provision applies only in the case of a multiple house and not, for example, to a pair of semi-detached houses let by a landlord. I do not think there is any difficulty in ascertaining the amount of repairs to a house. That is a simple matter of fact. If there is a dispute as to the amount, that can be dealt with by the court under the general powers conferred by Section 49 of the Bill. The position with which we are concerned here relates entirely to dwellings inside a house. That is the only case where the difficulty of apportioning the amount arises, and this amendment is to make it clear that the provisions of the Bill in this respect apply to dwellings inside a single house rather than to two semi-detached houses or to two attached houses in a row of houses.
Amendment agreed to.
I move amendment No. 7:
In page 10, line 29, to delete "buildings" and substitute "dwellings".
This is purely a drafting amendment.
Amendment agreed to.
Amendment No. 8 is out of order.
I move amendment No. 9:
In page 30, line 54, to add after the words "set out in" the words "or endorsed on".
We discussed this yesterday. It is purely a drafting amendment and I gather that the Parliamentary Secretary is prepared to accept it.
I am so persuaded.
It all emphasises the value of Parliamentary debate.
Amendment agreed to.
I move amendment No. 10:
In page 30, line 56, to add after the words "rent book" the words "and is carried forward in every subsequent rent book".
Has the Parliamentary Secretary been similarly persuaded?
If I could I should like to persuade Deputy Sweetman not to go ahead with this although I have no fixed view on it. I am just a little worried that it might lead to some cases of vexatious litigation. If the carrying forward of the amount of the deposit in the rent book was inadvertently omitted by a landlord, the tenant would have an immediate right to recover the deposit. That would not be a good thing. The intention of the original section was that the payment of the deposit would be noted somewhere, either in the agreement or in the rent book. We feel that even one noting down of it would achieve the purpose we wanted. I feel it might be safer to leave out this provision.
Once we have passed the previous amendment and the endorsement can be put on the agreement I do not think it matters so much and I withdraw the amendment.
Amendment, by leave, withdrawn.
I move amendment No. 11:
In page 31, line 4, to add after the words "vendor to give" the words "(by way of statutory declaration if so required)".
This arises out of another discussion we had yesterday. I seriously visualise difficulties where a vendor sells property subject to a deposit, the liability with the sale passing on to the purchaser who has got to refund that deposit. If the vendor, having got the purchase money, decamps the purchaser is left in the position where he has to pay and has no practical remedy although he may have a theoretical remedy. The effect of having the declaration would be that the vendor in such circumstances would be committing a criminal offence and obviously would therefore be made far more amenable. It is not likely to arise in many cases but there will be hardship in some cases and we have the precedent there already covering the Local Registration of Title Act. I think the same thing could be usefully imported into this Bill. The Parliamentary Secretary said that he wanted this section on all fours with the section about basic rents. While that perhaps is desirable from one aspect of uniformity, yet the Parliamentary Secretary will see that this is a clear way of doing something very different. We are asking a person to pay out money that he has never seen and before we ask him to do that we should take every possible step to ensure that he knows about the liability he has to undertake.
I accept this amendment, particularly when I find an experienced practitioner recommending it.
Amendment agreed to.
Question proposed: "That the Bill, as amended, be received for final consideration".
Is the House finished with the amendments?
We are dealing with the Bill as amended.
Are we finished with the amendments?
The amendments have all been agreed.
The Deputy wants to speak on the Fifth Stage. We have not reached it yet.
Question put and agreed to.
Agreed to take the Fifth Stage now.
Question proposed: "That the Bill do now pass."
I think it is right very briefly to make this statement from this side of the House. It has been a pleasure to deal with the Parliamentary Secretary in relation to this Bill. He came in here with a full knowledge of his subject. He was very courteous in dealing with Deputies and gave very full explanations. I think it right to say that from this side of the House.
May I speak on the Bill now?
The Deputy may speak on what is in the Bill now.
Would I be in order to refer to an amendment of mine, subsequently withdrawn?
The best way of finding that out is to refer to it.
Courtesy demands that I should ask the Chair.
It is not a courtesy but an embarrassment to the Chair to ask him.
On Section 4 Deputy Carroll moved an amendment in my name. Unfortunately, I could not be here to move it. The gist of it was:
Any tenant of a controlled dwelling shall be entitled at his option to a lease for a minimum period of twenty-one years at an open market rent where he or his family have been in occupation of the dwelling for thirty years or more.
The Parliamentary Secretary in his reply stated he was opposing amendment No. 14. He said in the first place that this House should be aware that under the Landlord and Tenant Act, on the termination of a tenancy, a tenant is entitled to a new lease of 21 years at an open market value where he or his predecessors have occupied the house for 30 years. I should like the Parliamentary Secretary to give me some assistance on this point. As I understand it, that applies in the first instance only to business premises and, secondly, in the case of houses situated outside an urban area it applies only if the land attached to the house does not exceed one acre.
Am I correct in saying that "land" is not designated more fully in the Landlord and Tenant Act? In other words, the land could include gardens, pleasure and vegetable gardens. That is not specified in the Act. The Parliamentary Secretary is now withdrawing a certain further degree of protection for the tenant I have in mind under the 1946 Act in that he is reducing the rateable valuation of the site in the case of Dublin and Dun Laoghaire from £15 to £10 and outside those areas from £10 to £5.
I should like to ask the Parliamentary Secretary what protection a tenant of a house situated outside an urban area on land exceeding one statute acre part of which would include gardens would have or a householder with land attached to his house the valuation of which exceeded £5? Would he, in effect, have any protection?
A sitting tenant is fully protected.
He is entitled to a lease at the open market price?
No. In the case of the reduction of the valuation from £15 to £10 sitting tenants are not affected.
Any new tenant is out?
New tenants are out.
Would the Parliamentary Secretary be prepared to review that?
No. With regard to the other point raised——
We are on the Fifth Stage. I want to make an observation. If the Parliamentary Secretary intervenes, it ends the debate.
If a Deputy asks me a question I can answer it. Section 19 of the Landlord and Tenant Act, 1931, applies to dwellings as well as to business premises. On the termination of the tenancy a person is entitled to a new lease for 21 years.
Is there any question of the valuation of the land or the extent of the land?
The 1931 Act applies in an urban area or outside an urban area provided the land attached is not more than one acre.
Exactly. That is the point I made. What does the Parliamentary Secretary describe as "land"?
I am not the. Minister for Agriculture.
The Interpretation Act is the appropriate one.
Does "land" include gardens?
Of course.
I would say that the Parliamentary Secretary is as good a judge as the Minister for Agriculture.
With all due modesty, I must reject that suggestion.
This is the Fifth Stage of the Bill as amended in Committee and on Report. All I want to be placed clearly on the record is this. So far as we are concerned, we recognise the legitimate claims of the owners of property and of the tenants but it does seem to us that in seeking to disentangle the long history of rent restrictions which goes back, as I said, to the first World War—close on 40 years or more—regard must be had to conditions as they are and not as we would wish them to be. We believe the Government is making a mistake in making this transitionary measure much more difficult of acceptance by its decision authorising an arbitrary increase in the rent of sitting tenants.
We believe that this adjustment in rent restrictions could have been much more equitably carried into effect had we excluded the sitting tenant from the arbitrary rent increase, bearing in mind that under the whole code of rent restriction there is a provision which provides that the landlord, in the event of exceptional repairs being carried out, is entitled to some adjustment in the rent of a sitting tenant on foot of those exceptional repairs.
It is not a good thing that the legislation of this House should operate to make a large body of citizens feel that they are being deprived of rights that they believe themselves to enjoy unless some grave reason makes that course imperative. It is right that this House should recall that landlords in the context of this legislation are by no means identical with landlords as that word is traditionally understood amongst our people. Landlords as traditionally understood by our people were persons of wealth and circumstance, who owned large properties, lived in great affluence, and derived their incomes normally from tenants of very modest means.
The landlords with whom we are dealing in this rent restriction code are quite a different category in our society and extend from the persons with considerable property all the way down to the people who are themselves in extremely straitened circumstances. We should bear in mind constantly, when considering legislation of this kind, that many of the persons here described as landlords are widows and elderly women and old people who have been living on the income from some small property, consisting perhaps of two or three houses, and who have seen that income dwindle in real value over the years as a result of the maintenance of rent restriction.
Bearing all that in mind, we have also got to look at the other side of the picture and to think of people with very exiguous incomes who have just been able to carry on because they have had the advantage of a low rent. We have got to think of the little shopkeeper, who might be properly described as a huckster, who is keeping a small family together on a little vegetable business or a little sweet shop and who simply is not in a position to pay more. If we authorise an increase in the rent we may create a situation in which such people's survival will be made impossible and they will be driven on to the streets to seek other accommodation, accommodation in which, in turn, it may be impossible for them to carry on such little businesses because not infrequently such small businesses are in strict relation to the contacts that such people have with their immediate neighbours who give them their custom and it is on that limited custom that they depend for their survival.
I do not think it is unreasonable that the House should also call to mind that in the legitimate category of the landlords that I have described and of the sitting tenant to whom an arbitrary increase in rent is an insufferable hardship, we have to remember, when considering the legitimate interest of the sitting tenant, that a great many large landlords and medium-sized landlords who will be affected by this legislation are not people who have inherited this property or purchased it 40 or 80 years ago and seen their real income dwindle through the depreciation of money. A great many of the landlords affected by this legislation are persons who bought houses from owners who could not carry on and who sold their little properties for 10 or 11 years' purchase, related to the low rents operating on these houses. These persons who quite legitimately entered the property market at a time when property values were standing at a low figure are going to get a wholly uncovenanted benefit through this arbitrary right to increase rents of sitting tenants by 12½ per cent. without regard to the repairs that they may carry out.
If we weigh up all these complex matters, one against the other, to see how best we can equate to all, we would, I think, have been much better advised had we devised a Bill in the course of our discussion here which would have created three broad categories of cases: (1) the sitting tenant, (2) the incoming tenant to vacated controlled premises and (3) the post-1941 tenants who are free of all control. I am not saying, and we have never contended, that this represents some kind of abstract principle. I do not think you can find in comprehensive legislation of this kind an abstract principle to guide you.
I am trying to depict an equitable, a human and a socially desirable method of dealing with this problem bearing in mind that this is not the last Rent Act this House will ever discuss and that the ideal position towards which we should all aspire is the creation in this country of a sufficient number of residences and premises so that the necessity for rent control will cease to exist, because, with surplus accommodation in existence, a true and fair position would arise in which there would be a free and equitable bargain made between a willing vendor and a willing purchaser to a tenant right in any premises. We have not reached that stage and, pending the realisation of that desirable situation, I believe we are doing something which will put a great hardship on a lot of small people. What troubles me—I think it should trouble the conscience of every Deputy—is that the people who will get hurt by this are unorganised; they are not vocal, and they never really know what it is that hits them.
They will learn.
They will feel the results but, if they knew what had hit them, and knew and felt there was some means of redressing their grievance, it would be some consolation. What troubles me is that there will burst on the heads of a whole lot of defenceless people this sudden 12½ per cent. increase, which will not be a large sum in terms of money; in many cases it may be only 2/6d. or 3/-.
Far less.
It may even be less. I know how hard it is for us sitting in this House to talk of a weekly impost of 2/- or 2/6d. as being something of substance. I am not charging the Parliamentary Secretary with being indifferent, but it is very hard to put oneself in the position of a person to whom a half-crown means a great deal. What troubles me particularly is that they are defenceless. They do not know what has happened but suddenly they find themselves bearing a burden that is harsh and an enduring grievance is created. I do not think I am wrong in saying we should concern ourselves with avoiding that kind of development. I do not think it is wrong to use the time of Oireachtas Éireann to inveigh against legislation which creates in the minds of individuals in our society that kind of obsessive resentment.
We are all familiar with the individual who has a grievance; I know of nothing more pathetic than the man or woman whom you meet and who says to you: "Could I tell you this story?" You wait to hear him out and at the end of it comes a thick wad of dog-eared correspondence and you know at once you are in the presence of somebody who has acquired a grievance which has been eating into his heart for years and years until he has become almost unbalanced. We should not laugh at it. There are few more pathetic things in the world. I often have had that correspondence presented to me and found in letter after letter——
Surely rent restrictions have nothing to do with that sort of fixation.
Hear me out. I have seen on files letter after letter pointing out that there is no remedy under the law for the grievance under which that person is labouring, that in fact the provisions of the law have been complied with. However, he does not understand it and when it goes on for a certain time he becomes incapable of absorbing explanations. There will be many small hucksters and dwellers who will be legally and properly charged in accordance with our legislation with this sudden and arbitrary increase in rent. I suppose the great majority of them, after their initial indignation has passed, will recognise what has happened but a considerable minority will feel that somebody got at them and imposed this burden on them, that they had a clear and surviving right to continue in the occupation of their little home at the rent they had been paying and that, somehow or another by some mysterious method, they had been fined this extra 1/6, 2/- or 2/6d. and an enduring and bitter grievance remains.
It is a mistake to do that bearing in mind that if we exempt the sitting tenant from this impost the effluxion of time will itself relieve the landlord in a large majority of cases. Even where the landlord does not want to wait so long, there is always open to him the opportunity of going to the sitting tenant and saying: "I can get 12½ per cent. more than the rent you are paying. What is it worth to you to get out?" The effluxion of time and the possibility of striking a bargain will remove, I imagine, 80 per cent. of the cases of hardship that arise if we leave the sitting tenant immune from the arbitrary increase in rent. I admit there would be the small residue of cases where the balance of hardship was on the property owner rather than on the tenant. But we are creating a far larger balance of grievances among the sitting tenants. Whatever sense of grievance landlords may have as a result of their inability to resolve this problem either by a bargain or the effluxion of time, it is much more likely they will understand and appreciate the situation than the huckster or the humble person living in a modest home.
We are not serving any useful purpose by making this arbitrary increase lawful at this time. I do not believe we are removing any substantial hardship which could not be removed by other means in the vast majority of cases and I do not believe that this is the last rent control Act this House will ever pass. The time is not far distant when a sufficiency of houses will be created to make almost any measure of rent control a supererogation.
In those circumstances I say to the Parliamentary Secretary that his Minister is making a mistake in not exempting the sitting tenant from this arbitrary rent increase. The rest of the legislation will be assured an infinitely better reception if that humane reform were adopted. For the reason that the sitting tenant is subject to this rent increase, I object to this Bill in its present form and I object most strenuously. I am not without hope that the Parliamentary Secretary's Minister may in another place reconsider this aspect of the Bill in which event, with all its imperfections, it will be very much less unacceptable than it is now.
Whatever justification there is for certain drafting alterations and for bringing rent restriction legislation up to date and incorporating it in a Bill of this nature, there has not been shown to our satisfaction or, I submit, to the satisfaction of those who will be affected by the Bill any justification for this decision to permit an increase of 12½ per cent. on the rent of controlled dwellings, particularly when this proposed permission to increase the rent by 12½ per cent. is not allied in any way with compulsion on the landlord to produce some evidence of expenditure on the dwellings concerned.
The question as to whether or not in the course of time there would be sufficient dwellings available in order to bring to an end the necessity for a system of rent restriction must be considered in relation to the physical facts, in relation to the density of population, in relation to the necessity for so many working class people to live convenient to the centres of population, convenient to transport, convenient to work, etc. Having regard to the development in our cities and towns over the years, I would hesitate to suggest any period, short of some decades, before the situation would be reached in which a free market for rents could operate to the reasonable advantage of the tenant. Whether we like it or not, there is a very substantial demand for reasonable and proper accommodation at reasonable rentsnear the centre of the city in cities like Dublin. The same demand exists, I am sure, in the case of other cities, and it will grow.
This Bill, in its past and in its present form, definitely confers on landlords engaged in the commercial exploitation of dwellings for the ordinary citizens and for the working classes—and there is no doubt that the Fianna Fáil Party are strong enough to force this measure through the House—and on landlords who, as a breed have been notorious for many years, particularly in our cities, benefits to which we do not think they are entitled.
In the course of his comments Deputy Dillon indicated that there are landlords and landlords. We agree, of course, that there are numbers of people who became landlords incidentally. There is not, evidently, any method by which we can divide the wolves from the sheep in that regard. Perhaps if there were some such method the Parliamentary Secretary might have found it possible to bring in some form of division. It is not the sheep among the landlords who will derive the main benefits but those who engage in the profession of landlords from a purely commercial professional point of view and who take every advantage of legislation of all kinds to increase the burdens on the tenant, as far as they can.
The objectionable part of this Bill— and because it is included the Bill should be opposed and must be opposed—is the part which provides benefits for these people without making any provision whatsoever that they shall be required to undergo expenditure. Aside from that, there are also the difficulties of people who, as a result of this Bill, may be deprived of their dwellings. The basis under which they may be deprived of their dwellings may be reasonable, but certainly, in present circumstances, it appears that the proposals in the Bill to compensate them for loss of their homes and other hardships and inconveniences, are inadequate.
I want to finish by saying that this is a Bill which, in one major respect, is slanted to the benefit of the landlord and against the interest of the tenant. For that reason the Bill itself is objecttionable from our point of view.
I should like the Parliamentary Secretary to take note of one matter which I am about to bring to his attention. Arising out of this debate he made a case for decontrolling small business premises. His point was that it was not the job of the landlord to subsidise the tenant. His assumption was that if a business premises was not decontrolled, the landlord would not get his proper rent.
The point I want to make is that the landlord bought his business premises at the controlled rent. I do not know whether or not the Parliamentary Secretary is paying any attention to me but I want to point out to him that the landlord who is to have his premises decontrolled now, bought those premises at the controlled rent. Therefore, he is not subsidising the tenant. Whatever the rent was—let it be £1, £2 to £3—it was on that basis that he bought the premises.
This Bill will allow the landlord to get the present-day market value of the premises, in other words, what the premises is now worth, whereas he bought it at what it was worth before the Bill was enacted. In what way then is the landlord subsidising the tenant? In the past, when a landlord bought a premises he paid according to whether it was or was not controlled. I know of a case where a person wanted to buy a premises. He offered so much for it if he could get vacant possession. The seller bought out several of his tenants and in that way the purchaser gave a larger sum because he was gaining vacant possession, whereas property owners bought their property at controlled rents.
They will now be made a present of 100 per cent. or 200 per cent. increase because if a small premises, a shop or a back room used for some purpose, was let 20 years ago at £1 a week— while agreeing it might now be worth £3 a week—the fact remains that it was not on the basis of £3 a week the landlord bought the premises but on the basis of £1 per week. If he had to buy that premises after the passing of this Bill he would have to pay considerably more money on the grounds that he would now be buying a decontrolled business premises. There is no point, therefore, in saying that the landlord is subsidising the tenant. He bought the property at the controlled rent and he knew that a certain amount of money would be required for certain repairs. If there were any justification for any increase it could only be on the basis of future repairs.
Surely the Parliamentary Secretary could add 12½ per cent. or something else in lieu of future repairs. Would not that meet the landlords legitimate claims? Surely decontrolling such property when, in fact, he bought it at considerably less, is making him a present of 100 per cent. or 200 per cent. more rent for no reason at all. If landlords knew the contents of this Bill in advance, they could become millionaires. Talk about being tipped off about the Budget. They could buy up all around them. The Parliamentary Secretary should consider the thousands of people in Dublin and throughout the country who are enabled to live simply because their rents are low. Now they are being asked to pay rents which will probably be increased by 100 per cent. or 200 per cent. In other words, if they were earning a week's wages, it would be equal to a reduction of £1 or £2 a week.
The Parliamentary Secretary's excuse is that they will get security of tenure and will not be interferred with for 21 years. But the position is that these people will not be able to carry on and may have to vacate the premises. In that way the landlord is getting something for nothing. Is it not normal practice that when a premises is decontrolled, it is bought out? But we are saving the landlord all that and he is getting it for nothing.
Nonsense.
A person paying £1 a week for some little business is brought into court and told his rent will be 50/- a week.
He will be asked to pay a fair rent.
Is the landlord entitled to it?
Of course.
On what basis?
Any man is entitled to a fair rent in respect of business premises.
If a man buys something in an auction room for a quid, is he entitled to say it is worth £5?
He is entitled to the full use of his own property.
He did not buy it at the present market value.
The Deputy's logic is based on the assumption that all these premises have been sold recently, which is not the case.
This business of property is becoming like the Stock Exchange and multiple stores. Certain people are buying up all around them. There are landlords who specialise in buying properties as a business. All those people will have the value of their property enhanced.
None of these people went around buying up hucksters shops with controlled rents.
I shall put a fair question to the Parliamentary Secretary. If a man has a little business, out of which he makes a livelihood of, say, a £1 a week, and his business is now to be decontrolled, will he not have to pay what is alleged to be the present market value and which is possibly a 100 per cent. or 200 per cent. more?
Not necessarily.
What does the Parliamentary Secretary mean when he says "not necessarily"?
The Deputy may make his own speech.
The tenant is brought into court and evidence is given that the rent of a similar shop is 50/- a week and that a similar order will be made. Is not that the position?
We are only decontrolling certain premises. I said "not necessarily" because we are not decontrolling every business premises. Mixed premises will still be controlled.
What about the decontrolled premises to which Deputy Sherwin referred? The Parliamentary Secretary's Ministerial colleague does not appear to understand.
I have explained it to Deputy Sherwin about fifty times already. Any reasonable person would understand it. In the case of decontrolled premises the tenant will have the right to go to the court and have a fair rent fixed, taking into account all the circumstances, the size of the business, the type, the locality, and everything like that.
And there will be a new value on the decontrolled premises.
Was the rent not already fair?
Not for a business premises.
Did not the landlord buy the premises on the strength of the rent?
No. As I told the Deputy, people do not go around buying up small hucksters shops with controlled rents.
Then why do you not put a section into the Bill saying it will not affect property bought in the past five or six years?
The Deputy must relate his remarks to the Bill.
A speculator may have bought property within the past five or 10 years. Why is there not a section to cover that type of property?
You could not do that.
These unfortunate people will be dragged into court and put out of business. They will be given the ultimatum of signing a 21-year lease they may not want to sign. Something may be hanging fire and they may be afraid to sign for 21 years. Those people can be got rid of without any compensation. The screws can be put on them by people not entitled to an increase. You are giving the landlords a present of 100 per cent. or 200 per cent. profit.
The Deputy is getting into the nonsensical sphere now.
People have come to me and put that point to me. It is not nonsensical from their point of view. It makes very good sense.
First, I should like to deal with the question which was raised about the 12½ per cent. increase in rent. I want to emphasise again in this regard that the 12½ per cent. is a very reasonable compromise between all the conflicting interests involved in this difficult situation. As I have already pointed out, the Conroy Commission which sat in 1950 recommended increases of 25 per cent. for landlords who are liable for all repairs and 12½ per cent. for landlords liable for part repairs. Despite the fact that a 40 per cent. increase in the cost of repairs has taken place since then, we only gave 12½ per cent.
If Deputy Dillon and the House are concerned so much with this type of tenant why have we not, in all the discussions and negotiations which have taken place in relation to this Bill, heard any volume of protest from tenants about this 12½ per cent.? I want to assure the House I have not received any protests——
They are not organised.
In so far as we have talked about the matter and discussed it at all, there is a general recognition and acceptance of the fact that it is a fair increase. As I told the House, I was particularly impressed in the negotiations which took place between the Dublin Artisans' Dwelling Company and their tenants by the reasonableness of the tenants in their approach to rent increases. They are the largest single body of tenants in Dublin who are organised, and they are organised very well in a very fine association. As I say, I was very impressed with the reasonable manner in which that body of tenants, which I am sure we can regard as representative of tenants generally, accepted that it was fair that landlords were entitled to some increase. It is insincere to try and manufacture this sort of thing in the House when it does not exist outside the House.
We were faced with a difficult and complex situation, with conflicting interests and problems of social justice on all sides. We came along with a fair and reasonable compromise, trying to do the best we could to keep the scales balanced as evenly as possible between all interests and it is less than honest to try to create this atmosphere of passion and to try to indicate that some grave hardship will ensue from what we are doing.
The whole principle on which the Bill is based is that it will not cause hardship to sitting tenants in any way. The 12½ per cent. increase is given mainly to enable landlords to carry out the repairs for which they are liable. There is no element of bonus in it. Their net income will not be increased compared with pre-control days. It is a good thing for the country as a whole and for tenants because it will help to keep the stock of houses which we have in repair. When we compare generally the rents payable by tenants in controlled dwellings with the rents charged by local authorities everybody knows that the rents charged by the local authorities to their tenants are in many cases far in excess of those charged for rent restricted houses and they will still be far in excess even when we do give the increase of 12½ per cent.
I can remember when I was a member of Dublin Corporation the situation that faced us on the Finance Committee by reason of the increased cost of repair of our houses. It was one of the largest single factors with which we had to cope when fixing the city rate and the cost was increasing all the time. Everybody was concerned about it at those meetings of the Committee and everybody was perturbed at the manner in which the cost of repairs was increasing year after year. If that is the position with regard to the comparatively modern dwellings of most local authorities, what must the position be with regard to the older buildings some of which are there for over 50 years?
With regard to the question of small business premises we feel, and we are fully reinforced in this by the report of the Conroy Commission, that purely business premises properly belong to the sphere controlled by the Landlord and Tenant Acts and should not be within the scope of the Rent Restrictions Acts. I have already indicated that the social principle underlying the Rent Acts is to see that justice is done with regard to one of the necessaries of life, the dwelling in which a man lives. As a matter of social justice, we have laid down certain conditions as to what a landlord is entitled to charge and as to when he should be entitled to recover possession but that argument does not apply to a purely business premises. If we were taking all control off these business premises we would certainly be justified in doing so but to be scrupulously fair we have given them immediate access to the Landlord and Tenant Act. We are saying to business people that, from now on, they will have to pay a fair rent, and no more than a fair rent, for their premises.
A business premises let with a residence will remain controlled but in the case of a purely business premises, where no residence is involved, we are asking that landlords should no longer have to subsidise the business of their tenants. We are asking that they should pay a fair rent to be fixed by the courts. If it is a small business of the huckster nature and if the building is in bad repair or the business is doing badly the courts will surely take that into account. Deputy Sherwin is utterly wrong when he talks about people buying up such premises within the last few years and now getting a bonus. That did not happen.
The main plea put by Deputy Dillon in his remarks was that we should drop the 12½ per cent. increase. I cannot accept that. I have already given all the arguments fully for our case in that regard. We are only giving that increase in a case where a landlord is liable for repairs. It is in the public interest that the landlords should be facilitated to enable them to keep houses in the best possible condition. It is in the national interest that they should do this.
Does not the Bill permit a landlord who does not do the repairs to obtain the 12½ per cent. increase in his rent?
That seems to be an argument rather than a question.
I have dealt with that argument over and over again in this debate.
Question put.
The Dáil divided; Tá, 58, Níl, 39.
Tá
- Blaney, Neil T.
- Boland, Gerald.
- Boland, Kevin.
- Booth, Lionel.
- Brady, Philip A.
- Brady, Seán.
- Brennan, Joseph.
- Brennan,Paudge.
- Breslin, Cormac.
- Briscoe, Robert.
- Browne, Seán.
- Burke, Patrick.
- Calleary, Phelim A.
- Carty, Michael.
- Collins, James J.
- Corry, Martin J.
- Cotter, Edward.
- Humphreys, Francis.
- Johnston, Henry M.
- Kennedy, Michael J.
- Killilea, Mark.
- Kitt, Michael F.
- Lemass, Seán.
- Loughman, Frank.
- Lynch, Celia.
- Lynch, Jack.
- MacCarthy, Seán.
- McEllistrim, Thomas.
- MacEntee, Seán.
- Crowley, Honor M.
- Cummins, Patrick J.
- de Valera, Vivion.
- Doherty, Seán.
- Donegan, Batt.
- Dooley, Patrick.
- Egan, Kieran P.
- Egan, Nicholas.
- Fanning, John.
- Faulkner, Padraig.
- Galvin, John.
- Geoghegan, John.
- Gibbons, James.
- Gogan, Richard P.
- Haughey, Charles.
- Healy, Augustine A.
- Hillery, Patrick J.
- Medlar, Martin.
- Millar, Anthony G.
- Moloney, Daniel J.
- Mooney, Patrick.
- Ó Brian, Donnchadh.
- Ormonde, John.
- O'Toole, James.
- Ryan, James.
- Ryan, Mary B.
- Sheldon, William A.W.
- Smith, Patrick.
- Teehan, Patrick J.
Níl
- Beirne, John.
- Blowick, Joseph.
- Browne, Noel C.
- Burke, James.
- Carroll, James.
- Casey, Seán.
- Coogan, Fintan.
- Corish, Brendan.
- Cosgrave, Liam.
- Crotty, Patrick J.
- Desmond, Daniel.
- Dillon, James M.
- Everett, James.
- Fagan, Charles.
- Giles, Patrick.
- Hogan, Bridget.
- Kenny, Henry.
- Kyne, Thomas A.
- Larkin, Denis.
- Lynch, Thaddeus.
- MacEoin, Seán.
- McMenamin, Daniel.
- McQuillan, John.
- Manley, Timothy.
- Murphy, William.
- Norton, William.
- O'Higgins, Michael J.
- O'Higgins, Thomas F.
- O'Reilly, Patrick.
- Palmer, Patrick W.
- Reynolds, Mary.
- Rogers, Patrick J.
- Russell, George E.
- Ryan, Richie.
- Sherwin, Frank.
- Spring, Dan.
- Sweetman, Gerard.
- Tiemey, Patrick.
- Wycherley, Florence.
Tellers:— Tá: Deputies Ó Briain and Loughman: Níl: Deputies Larkin and Casey.
Question declared carried.